China Unexpectedly Reports Trade Surplus
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China reported an unexpected trade surplus last month as import growth trailed forecasts, underscoring risks of a deeper slowdown in the world's second- largest economy.
Inbound shipments rose 5.3 percent, the customs bureau said today, below the 9 percent median estimate in a Bloomberg News survey. Exports increased 8.9 percent from a year earlier, more than forecast, leaving a trade surplus of $5.35 billion, compared with a median projection for a $3.15 billion trade deficit.
Asian stocks fell amid renewed concern about growth in China, fiscal woes in Europe and Federal Reserve Chairman Ben S. Bernanke's comment that the U.S. economy was far from a full recovery. Premier Wen Jiabao may need to balance gains in external demand with a slowdown in domestic consumption in deciding whether to add monetary or fiscal stimulus.
“The sluggish import growth shows weakening domestic demand and investment growth while exports are stabilizing,” said Chang Jian, economist at Barclays Capital in Hong Kong who formerly worked for the World Bank. “Policy makers need to strike a delicate balance between preserving growth and containing inflation at this stage, yet they may tilt more toward sustaining growth in the second quarter.”
In Japan, the central bank refrained from expanding monetary easing to counter deflation, resisting pressure from lawmakers who five days ago rejected a nominee for the policy board. The Bank of Japan kept the key interest rate between zero and 0.1 percent and left its 30 trillion yen ($368 billion) asset-purchase fund and 35 trillion yen credit-lending program unchanged.
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