Commerzbank’s Volkmar Baur notes that China’s March trade data were slightly weaker than expected, with exports underperforming forecasts and imports surging, narrowing the trade surplus. He estimates the current account surplus likely eased from Q4’s multi‑year high. Despite this, CNY has strengthened versus the Dollar, with USD/CNY trading below 6.82, its lowest level in over three years.

Yuan firms even as surplus eases

"Based on the trade data, it can be estimated that China’s current account surplus in the first quarter, relative to GDP, likely came in slightly lower than in the fourth quarter of last year, when it reached a multi-year high of 4.9%."

"Imports, on the other hand, rose by 27.8% year-over-year, a much stronger increase than anticipated. As a result, the trade surplus declined, though at $51.1 billion, it remains very high."

"Since the start of the month, the CNY has thus appreciated by over one percent against the USD, which is surprising given the ongoing uncertainties surrounding developments in the Gulf region."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)