China’s exports jump 14.2% in March, but imports shrink 7.6%

China's March exports came in at a 14.2% year-on-year increase, following a steep 20.8% decline in the combined months of January and February, data from China’s General Administration of Customs showed on Friday.

As Lunar New Year festivities usually take place within the first few months of the year, the data discrepancies are caused by base effects due to the festival being held on different dates compared to previous years.

The export reading last month was higher than economists' estimates of a 6.5% increase, providing a boost to a stronger recovery in exports for the first three months of the year.

China’s imports however, fell by 7.6% in March, extending from the 5.2% decline in February. The reading was also below the estimates of a 0.1% growth.

Adding it up, the data showed that China’s exports gained 0.9% for the first quarter and its imports sank by 4.4% in the same period.

Trade surplus rose to US$76.31 billion but total trade with US fell

For the first three months of this year, China’s total trade with the United States (US) fell by 11%.

Total trade surplus widened to US$76.31 billion over the first quarter of this year, higher compared to US$54.6 billion in the fourth quarter.

Better factory data revealed earlier this month supports the improved export numbers.

China’s manufacturing sector reflected growth for last month and moved to expansionary mode, with Caixin/Markit Manufacturing purchasing managers’ index coming in at an eight-month high of 50.8 points, while the official PMI number was at 50.5 points.

Trade progress between US and China

China has been broadly affected by the weakened trade earlier due to the United States (US)-Sino trade conflict but trade progress between the two parties in recent weeks have cooled the bearishness on the ground.

On Wednesday, news agencies reported that China and the US have agreed to set up enforcement offices to monitor the implementation of trade pledges, reflecting concrete steps taken between both parties to getting a trade deal sorted out.

At the opening of China’s National People’s Congress in March, China’s premier Li Keqiang said the Chinese economy will likely slow this year, forecasting economic growth target for this year to be between 6.0% and 6.5%. Last year, the country expanded by 6.6%, its slowest growth since 1990.

Earlier this week, the International Monetary Fund improved the outlook for Chinese growth this year to 6.3%, as the conflict between the US and China on their trade deal did not worsen as expected from its earlier forecast.