TD Securities research team suggests that according to their model, China is likely to post an outsized decline in imports (-23.0% y/y ) in January, largely due to base effects but also much weaker exports data from South Korea, Vietnam, Singapore and Taiwan.

Key Quotes

“Adding in the impact of the seasonal impact of Chinese New Year, with weaker activity towards the end of January, it points to a very soft imports print.”

“Exports are likely to look slightly better (+2.4% y/y), albeit still remaining weak. Such a weak outcome will likely provoke further speculation of an easier Chinese policy stance and put pressure on China to agree on a trade deal at the meeting between President’s Xi and Trump at the end of February.”