January trade growth distorted by fluctuating holiday dates

China’s imports and exports rose by 85.5% and 21% respectively in January over last year, although economists warned against reading too much into the figures, citing the low base comparison in January 2009 and the timing of the Lunar New Year holiday. The holiday falls in February of 2010, which effectively means there was one more working week in January of this year compared to last year, Reuters reported. China’s trade surplus narrowed to US$14.17 billion from US$18.44 billion in December. The continued recovery in exports is likely to intensify pressure on Beijing to allow its currency to appreciate against the US dollar. The renminbi has barely moved since mid-2008 as the government sought to assist domestic exporters. However, viewed on a month-on-month basis, as opposed to the standard year-on-year calculations, China’s exports actually declined 16.3% in January while imports fell by 15.1%.