China's export slump deepened in February, highlighting the challenge for policy makers seeking to keep the economy humming at home while trade acts as a brake on growth. The week-long Chinese new year holidays fell in February this year, closing factories and curbing shipments. That saw exports tumble 25.4% in US dollar terms from a year earlier, the biggest decline since May 2009. Imports extended a streak of declines to 16 months, slumping 13.8%, leaving a trade surplus of US$ 32.6 billion. A slowdown in global trade is making it harder for China's leaders, who are gathered in Beijing this week to set the nation's economic plans, to keep growth at the targeted 6.5-7% range.
Much of the export slump is down to distortions from the holiday, said Julian Evans-Pritchard, a China economist at Capital Economics Ltd. "We really need the whole of first quarter data to work out what is underlying demand and what is seasonal impact," he said. Shipments to all major trading partners declined, plunging more than 20% to the US, Brazil, Canada, Germany, France, Hong Kong, Japan, and ASEAN nations.