Research Team at HSBC, suggests that the Chinese January export and import data surprised the market on the downside, even though the headline trade balance was higher than expected. Key Quotes “Export growth was -11.2% y-o-y, the lowest reading since March 2015. Shipments to most of China's major trade partners declined, with exports to ASEAN and the EU seeing the biggest contractions, at -18% and -12% respectively. The disappointing export figures served as a stark reminder of the continued weakness in external demand, which likely more than offset any boosts from front-loading of shipments before the Lunar New Year and a favourable base effect. Meanwhile, imports were also much lower than the market expectations at -18.8% y-o-y, with imports of major commodities seeing sharp contractions in both value and volume terms. While the weak external picture is likely to persist, policy makers should adopt a larger stimulus package focusing on domestic demand, meaning more aggressive monetary and fiscal easing in the coming months.” For more information, read our latest forex news.