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Blokland’s daily sketch

Blokland’s daily sketch

14-10-2019

China trade data worsens: does it need a deal?

  • Jeroen Blokland
    Jeroen
    Blokland
    Portfolio Manager

Chinese trade data for September look pretty ugly. Exports are down 3.2% YoY and imports are down a heavy 8.5% YoY. While the former is obviously related to the US-China trade conflict, the latter implies domestic demand is decelerating. For some investors, these numbers are a clear indication that China is willing to come to an agreement with the US on trade. On the other hand, China may use the trade war to account for lower GDP growth, which was unavoidable in any case. From this angle, China may be far less willing to reach a substantial deal on trade. So, while last week’s ‘phase one’ deal between the two countries is definitely encouraging, uncertainties around the scale and meaningfulness of any deal remain significant.

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As a senior portfolio manager I use charts to illustrate financial issues every day. I tweet my favorites as @jsblokland and was named 'one of the 50 most important people for investors to follow in 2018' by MarketWatch.
Previous editions of the daily sketch can be found on my personal financial markets blog. All graphics provided are collected from Bloomberg data and public websites. They do not always reflect my personal opinion and may also not necessarily reflect the opinion of Robeco. Please cite all references or quote the original source if replicating content.

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