It’s been a while since the market considered the possibility of a yuan devaluation: after the latest Chinese trade data it’s time to start seriously thinking about it once again.
Overnight, China reported May trade data which revealed that exports again slowed sharply and missed market expectations, while imports also contracted but modestly beat expectations: *CHINA MAY EXPORTS -7.5% Y/Y IN DOLLAR TERMS; EST. -1.8%
*CHINA MAY IMPORTS -4.5% Y/Y IN DOLLAR TERMS; EST. -8.0%
Although it was partly due to base effects, the underlying momentum has clearly slowed after a resilient 1Q. As SocGen notes, the disappointing export data helps explain the weakness in the manufacturing sector as the latest PMI data showed. And despite the French bank’s call for near-term growth resilience in DMs, exports remain a key headwind to China’s manufacturing sector. More importantly, the data clearly reinforces expectation for more easing from the PBoC. Some more […]
Read the Whole Article From the Source: www.zerohedge.com
-
Learn the TRUTH about Gold IRAs and how most precious metals companies play dirty.
