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The dollar value of China’s exports contracted unexpectedly in February as imports spiked, resulting in the country’s first trade deficit since early 2014.

Exports dropped 1.3 per cent year on year in dollar terms last month, according to data from the General Administration of Customs. That was far below a median estimate predicting a rise of 12.3 per cent from economists surveyed by Reuters and marked a substantial drop from January’s growth in outbound shipments of 27.9 per cent.

Imports ballooned 38.1 per cent year-on-year in dollar terms last month, more than doubling from January’s rise of 16.7 per cent and well above a median forecast of 20 per cent growth.

Those trade flows produced a trade deficit of $9.15bn last month, the first deficit since February 2014. That ran counter to expectations of a $25.8bn trade surplus and a marked fall from January’s surplus of $51.35bn. In local-currency terms that shook out to a deficit of Rmb60.4bn, also the first since February 2014.

The trade deficit came despite the fact that the Chinese currency’s exchange rate against the dollar ended February 5 per cent weaker from a year prior – though the renminbi did firm 0.25 per cent over the course of last month to Rmb6.867.

It is worth noting, however, that monthly trade figures for January and February tend to be relatively erratic thanks to the influence of the long lunar new year holiday.

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