China reports a record trade deficit
China reports in February a new record trade deficit of USD 31.5 billion reflecting weak global demand and thus another reason why the Chinese government is accelerating domestic consumption in order to make up for the losses at the export front
Chinese exports were still growing at 6.8 % in the first two months of the ongoing year but exports to Europe were 1.1 % less due to the debt crisis. According to the bank HSBC growth of processing imports decreased to 2.4 % as to compare to 2011 and down from 8.6 % in the fourth quarter. Those imports are significant to China’s exports and reflecting that Chinese factories expect a more lean business in the months ahead and they keep inventory as low as possible. This is another reason why the Chinese currency is on a very slow course to further increase its outside value.