Equity futures markets (US and Asian) and AUD are sliding off overnight highs amid the worst YoY exports performance in China since October 2009.
[7]
The 3.1% drop (compared to expectations of a 3.7% gain) is the biggest miss in a year and the first negative print since January 2012 - making the second big miss in a row as the 'fake' trade data driven by the shadow-banking-arbitrage is unwound out of historical data.
- *CHINA JAN.-APRIL TRADE DATA REFLECTS ARBITRAGE TRADE: ZHENG
[8]
Notably, related to the CCFD debacle, copper imports fell 20% in H1 2013 compared to H1 2012 - which helped to create another huge miss in China imports data overall (-0.7% vs expectations of a 6.0% jump). It is perhaps no surprise - given the sheer size of these misses, that China Customs officials stated that 'the country faces serious challenges in exports and imports."
They blame weak external demand, higher labor costs, and a strong Yuan as the vicious export-driven economy-slowdown drags on industrial production's import demand.
But:
- *EXPORT MANAGER INDEX FELL IN JUNE, SIGNALS WEAK 3Q TRADE: ZHENG
Equity markets are recovering their knee-jerk reaction - as this must be good for moar printing? Though adversely gold is slipping lower.
[9]
but China (and Hong Kong) are not bouncing...
[10]
and AUD is not happy...
[11]
Perhaps - just perhaps - that 3% hard-landing [12] is not as unrealistic as the mainstream seems to think?
Charts: Bloomberg