Recently released trade figures for September continued to prove resilient. USD-denominated exports rose by +14.5% y/y (up from +9.1% in August) driven by strong demand growth from the EU (+17.4%), ASEAN (+14.1%) and the U.S. (+14%). Import growth decelerated to +14.3% y/y (from +19.9% in August) on the back of lower demand for U.S. goods (-1.2%) while demand for ASEAN (+19.1%) and European goods (+9.1%) was fairly resilient. Our take is that the strong export performance reflects (i) a frontloading of orders by U.S. corporates before a further rise in U.S. tariffs, and (ii) the impact of the RMB depreciation as a shock absorber. On the import side, slower expansion is due to higher costs following both tariffs and currency depreciation. Looking ahead, the next key data release is Q3 GDP growth which we expect at +6.5% y/y (after +6.7% in Q2).
