Chinese exports rose by nearly 40% year on year in February. Imports also increased, but more slowly than exports, which lifted the trade surplus. Over the past 12 months, China’s trade surplus reached about 6.2% of GDP. The combined January–February surplus was also reported at about 6.2% of GDP.

Currency Moves And Trade Balance

The CNY appreciated slightly against the US dollar in the first two months of the year. The CNY also rose only slightly against the euro over the same period. Exports to the United States fell by 11%. Exports to the EU increased by over 27%, despite the modest rise in the CNY. The article states it was produced with the help of an AI tool and reviewed by an editor. We are looking back at the exceptionally strong Chinese export data from early 2025, when year-on-year growth for February approached 40%. This performance created a massive trade surplus, equivalent to about 6.2% of GDP over the preceding 12 months. The key takeaway from that period was the export sector’s strength, even as the CNY firmed slightly against the dollar and euro.

Implications For Traders In 2026

This contrasts sharply with the situation now in the first quarter of 2026. Recent data shows China’s official manufacturing PMI for February 2026 came in at 49.9, failing to show the robust expansion we saw a year ago. This softening suggests the export momentum from 2025 has not carried over, creating uncertainty for the coming weeks. Given this divergence, traders should re-evaluate currency positions on the Chinese Yuan. While the CNY’s slight appreciation in early 2025 did not hinder trade, the current weaker economic pulse means authorities may resist further strengthening to support exports. We see this in the USD/CNY exchange rate, which has stabilized near 7.28, implying that options strategies betting on the yuan remaining in a tight range could be prudent. The significant shift in trade from the US to the EU seen in 2025 makes European indices particularly sensitive to China’s current slowdown. While exports to the EU surged by over 27% back then, the current weakness in Chinese demand could disproportionately affect German industrial stocks. This may warrant considering put options on the DAX index as a hedge against a potential drop in European exports. This weaker manufacturing outlook is also weighing on industrial commodity markets. Last year’s boom supported strong prices, but as of March 2026, copper prices have retreated over 3% from their recent highs amid concerns over Chinese demand. Traders should monitor inventory levels closely, as any further builds could signal opportunities to short commodity futures. The dynamic between the Eurozone and China has become more complex. In 2025, the CNY remained stable against the euro, but now, with the European Central Bank still signaling caution over inflation figures that remain above its 2% target, monetary policies are diverging. This could introduce greater volatility to the EUR/CNY pair, making long volatility strategies like straddles attractive. Create your live VT Markets account and start trading now.

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