2. Business Week - Over the weekend, China reported a $31.5 billion trade deficit for February. While it was the third time China’s trade balance went negative in the last two years, this deficit dwarfs its previous ventures into the red. China posted a $7.3 billion trade deficit in February 2011, and a $7.2 billion deficit in March 2010.
The first two months of China’s balance of trade data tends to be cloudy since it includes the Chinese new year, the country’s biggest holiday, when people take a week off work and exports tend to fall. That said, February’s deficit was China’s biggest since December 1989, when it soared to $66 billion. Still, most China analysts are hesitant to read too much into the February number.
China's export growth is slowing and it seems likely that the yuan will appreciate more slowly and could stop appreciating for a time.
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