China’s exports have plunged by a fifth while the US witnessed a cut in jobs growth in a sign of the two countries’ trade war and global economic slowdown.
Official figures show Chinese exports slumped by 20.7% in February from a year earlier.
The sharpest fall in three years, coupled with a 5.2% drop in imports against a forecast 1.4%, has fuelled fears of a “trade recession”, despite Beijing taking remedial action.
While seasonal factors may have had an impact, the fall in exports was far bigger that the 4.8% expected by economists polled by Reuters.
The bleak data for the world’s second largest economy comes a day after the European Central Bank slashed growth forecasts for the region.
Raymond Yeung, greater China chief economist at ANZ, said: “Today’s trade figures reinforce our view that China’s trade recession has started to emerge.”
While the country still recorded a trade surplus of $4.12bn (£3.2bn) for the month, this was much smaller than forecasts of $26.38bn (£20.3bn).
Meanwhile, US jobs growth almost stalled in February, with the economy creating only 20,000 jobs, raising concerns about a slowdown in economic activity.
A poll of economists by Reuters had forecast an increase of 180,000 jobs last month.
Wall Street saw a fall with the near-stagnant jobs growth – the weakest since September 2017.
However, the unemployment rate fell back to below 4% and annual wage growth was the best since 2009.
Nevertheless, the economy that in July will mark 10 years of expansion, the longest on record, is slowing and the weakening jobs growth will support the Federal Reserve’s “patient” approach toward further interest rate increases this year.
Michael Pearce, senior US economist at Capital Economics in New York, said: “The sharp slowdown in payroll employment growth in February provides further evidence that economic growth has slowed in the first quarter.
“That adds weight to our view that the Fed will not be raising interest rates this year.”
The weak figures follow months of intense negotiations between Washington and Beijing aimed at ending their trade dispute.
US President Donald Trump postponed a sharp tariff hike planned for early March as the talks progressed, but both Washington and Beijing have kept previous duties in place.
Even if a trade deal is reached, China’s exporters will have to deal with weakening demand globally, particularly in Europe.