The disappointing trade figures pointed to weaker demand both at home and aboard, and deepened concerns over the latest depreciation in China’s yuan currency CNY, which hit a fresh six-year low against a firming US dollar yesterday.
“This comes on the heels of weak South Korean trade data, and it definitely make us worry about to what extent global demand is improving,” said Luis Kujis, head of Asia economics at Oxford Economics in Hong Kong.
Asian stocks tumbled to three-week lows and US stock futures and Treasury yields fell after the data, while copper prices in London slipped.
China’s exports had been expected to fall 3%, slightly worse than in August, as global demand for Asian goods remains stubbornly weak despite heading into what is usually the peak year-end shopping season.
Weaker demand for Chinese goods was seen in nearly all of its major markets in the US, Europe and much of Asia.
Imports shrank 1.9%, dashing hopes for a second rise in a row. Imports had unexpectedly grown 1.5% in August, the first expansion in nearly two years, on stronger demand for coal and commodities such as iron ore which are feeding a construction boom.
That left China with a trade surplus of $41.99bn for the month, the lowest in six months, the General Administration of Customs said yesterday. Analysts had expected it to expand slightly to $53bn.
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