Articles

Summary:

• China December exports and imports beat forecasts

• Exports +6.6% y/y; imports +5.7% y/y in dollar terms

• December trade surplus $114.1bn

• 2025 trade surplus hits $1.19tn on flat imports

• US bilateral surplus eases slightly in December

China closed 2025 with a stronger-than-expected trade performance, as December exports and imports both beat forecasts, underscoring the economy’s continued reliance on external demand even as domestic momentum remains uneven.

Customs data showed December dollar-denominated exports rose 6.6% y/y, well above the Reuters poll forecast of 3.0% and slightly stronger than November’s 5.9% pace. Imports increased 5.7% y/y, sharply beating expectations for a modest 0.9% rise and accelerating from a 1.9% gain previously. As a result, China recorded a December trade surplus of $114.1 billion, marginally above the $113.6 billion consensus.

In yuan terms, exports rose 5.2% y/y in December, while imports climbed 4.4% y/y, producing a trade surplus of CNY 808.8 billion. The divergence between dollar- and yuan-denominated figures reflects currency effects over the period but does not materially change the underlying picture of firm trade flows at year-end.

For full-year 2025, China’s export performance remained resilient. Dollar-denominated exports rose 5.5% y/y, while imports were flat year-on-year, resulting in a record trade surplus of $1.189 trillion. In yuan terms, exports increased 6.1% y/y and imports edged up 0.5% y/y, with the annual trade surplus reaching CNY 8.51 trillion.

The data highlight how China’s growth model continues to lean heavily on exports amid subdued domestic demand, particularly in consumption and private investment. Strong overseas shipments have been supported by competitive pricing, supply-chain dominance in manufactured goods, and continued redirection of exports toward non-U.S. markets as trade frictions persist.

China’s December trade surplus with the United States narrowed slightly to $23.25 billion, from $23.74 billion in November. While the bilateral balance remains large, the modest easing suggests some rebalancing at the margin, even as trade tensions and tariff uncertainty continue to shape export patterns.

Overall, the latest trade figures reinforce the view that China’s external sector remains a key stabiliser for growth heading into 2026. However, the scale of the surplus also risks intensifying trade scrutiny from major partners at a time when global protectionist pressures are rising.

This article was written by Eamonn Sheridan at investinglive.com.

Full year data out from China.

2025 yuan-denominated:

• Exports +6.1% y/y
• Imports +0.5% y/y
• Two-way trade value at 45.47 trln yuan, +3.8% y/y. A record high.

Of more interest is the December trade trade, yet to re released. I’ll post separately.

This article was written by Eamonn Sheridan at investinglive.com.

Summary:

• World Bank lifts global growth forecasts for 2025–26

• Global GDP seen at 2.6% in 2026, 2.7% in 2027

• US resilience drives bulk of upward revision

• Emerging market growth remains structurally weak

• 2020s shaping up as weakest growth decade since 1960s

The global economy is showing greater resilience than previously expected, but growth remains too uneven and too weak to meaningfully reduce poverty or lift long-term living standards, according to the latest Global Economic Prospects report from the World Bank.

In its semi-annual assessment, the World Bank said global GDP growth is forecast to slow modestly to 2.6% in 2026 from 2.7% in 2025, before edging back up to 2.7% in 2027. While the headline profile remains subdued, the Bank upgraded its 2026 growth forecast by 0.2 percentage points from its June outlook, and lifted its 2025 estimate by 0.4 percentage points, citing stronger-than-expected performance in advanced economies.

Around two-thirds of the upward revision reflects resilience in the United States, despite ongoing tariff-related trade disruptions. The Bank expects U.S. growth to rise to 2.2% in 2026, from 2.1% in 2025, with both figures revised higher from June. It said an early surge in imports to front-run tariffs weighed on growth in 2025, but larger tax incentives are expected to support activity in 2026, partially offsetting the drag from tariffs on investment and consumption.

Despite the improved near-term outlook, the World Bank warned the global economy is on track for its weakest decade of growth since the 1960s, a pace insufficient to prevent stagnation, joblessness and rising vulnerability across emerging markets.

“With each passing year, the global economy has become less capable of generating growth and seemingly more resilient to policy uncertainty,” said the World Bank’s chief ​economist. He cautioned that resilience and dynamism cannot diverge indefinitely without placing strain on public finances and credit markets.

Growth in emerging market and developing economies is forecast to slow to 4.0% in 2026 from 4.2% in 2025, though both projections were revised modestly higher. Excluding China, growth in this group is expected to stagnate at 3.7%, unchanged from 2025.

China’s growth is seen easing to 4.4% in 2026 from 4.9%, though both figures were revised up from June, reflecting fiscal stimulus and stronger exports to non-U.S. markets.

Overall, the report paints a picture of a global economy that is holding up better than feared, but increasingly reliant on a narrow set of growth engines.

This article was written by Eamonn Sheridan at investinglive.com.

Summary:

• Reuters Tankan shows manufacturers’ mood slips to six-month low

• Manufacturing index falls to +7 from +10 in December

• Materials sectors (oil/ceramics, steel, chemicals) lead declines

• Non-manufacturers dip slightly to +32 from +33

• April outlook diverges: manufacturers improve, services worsen

Japanese business sentiment softened at the start of the year, with manufacturers’ confidence slipping to a six-month low in January as weaker demand from major economies weighed on materials-heavy sectors, according to the latest Reuters Tankan poll.

The monthly survey, which tracks the Bank of Japan’s closely watched quarterly tankan, showed the manufacturers’ sentiment index fell to +7 in January from +10 in December, marking a second consecutive decline while remaining in positive territory. The index is calculated as the share of optimistic responses minus pessimistic ones, meaning readings above zero still indicate net optimism.

The pullback was most pronounced in materials industries. The oil and ceramics sector recorded one of the steepest drops, falling sharply to zero, while steel sentiment deteriorated further into deeply negative territory and chemicals confidence also eased. Companies cited lacklustre demand conditions across key export markets, with one steelmaker pointing to weaker Chinese orders for automotive-linked goods. Others flagged softer consumer spending in the U.S. and China, while some manufacturers pointed to the drag from tariffs on exports.

By contrast, the auto and electronic machinery sectors saw only modest declines, suggesting parts of Japan’s industrial base are holding up better than materials producers exposed to the global cycle.

Sentiment among non-manufacturers edged slightly lower, with the index slipping to +32 from +33. The decline was led by wholesalers and retailers, though other areas such as information services, transport and real estate improved. Some service-sector firms also referenced a fall in Chinese tourism linked to a bilateral diplomatic row, with one department store manager reporting a sharp drop in foreign tourist sales. Others, however, said the broader inbound demand backdrop remained resilient.

Looking ahead, companies see a divergence in momentum. Manufacturers expect sentiment to improve to +10 by April, while non-manufacturers anticipate conditions deteriorating to +26, pointing to rising caution in the services economy even as factories look for a cyclical rebound.

For the Bank of Japan, the results underscore a mixed picture: manufacturing is still positive but losing steam, while domestic-facing sectors remain supported yet increasingly vulnerable to trade and tourism shocks.

—

With a weak yen, be careful of intervention risk:

• USD/JPY is surging still. Do we pencil in January 19 for Bank of Japan intervention?

This article was written by Eamonn Sheridan at investinglive.com.

Just a quick data post. Its not moving NZD/USD around much at all.

New Zealand Building Permits (November)

+2.8% m/m

• prior –0.9%
• for the y/y, +13.5%

This article was written by Eamonn Sheridan at investinglive.com.

A couple of headlines, should make export to China easier:

• US eases regulations on Nvidia H200 chip exports to China-Federal Register
• Us says before exports of Nvidia H200 chips to China, shipments will be reviewed by third-party testing lab to confirm technical AI capabilities –Commerce Department

I’ll post more detail separately as it becomes available.

This article was written by Eamonn Sheridan at investinglive.com.

December trade data from China headlines the economic and event calendar in Asia today.

A couple of things to keep in mind:

• The time of release is scheduled for 0300 GMT, which is 2200 US Eastern time. The trade data does not necessarily get published on time, so if you are awaiting it it’ll pay to be flexible on this.
• Also, the trade data often comes out in dribs and drabs, it can take a good hour or so sometimes to get the complete picture.

We had plenty to going on with from China last week. I posted on what I though was a clear signal from the People’s Bank of China:

• China flags rate and RRR cuts in 2026 as PBoC leans dovish

A clear signal of what, you ask? I said in that post (as a big bold print in the chart attached, check it out at that link) that ‘reading between the lines the PBoC is asking to stop buying so much yuan’. That turned out to be a good take with:

• the Chinese yuan pulled back from a 32-month high after the PBoC set a weaker daily fix for the first time in four sessions

After that pullback yuan has edged higher still, even in the face of a strong USD elsewhere. See screenshot at the top of this post.

Since then we’ve had inflation data from China:

• China inflation hits near three-year high, but producer deflation signals weak demand

• China CPI rose 0.8% y/y, fastest since Feb 2023

• Monthly CPI beat expectations at +0.2%

• PPI fell 1.9% y/y, easing but still deflationary

• Core inflation steady at 1.2%

• Weak demand and property stress remain key drags

China’s consumer inflation accelerated in December to its fastest pace in nearly three years, while factory-gate prices remained in deflation, underscoring the persistent imbalance between improving headline prices and still-weak underlying demand.

*

Back to the trade data, well US-China trade more specifically. Yesterday Trump blabbed out another tariff threat:

• Trump threatens 25% tariff on countries doing business with Iran. No detail, just bluster.

As I said yesterday:

• The White House provided no implementation detail, leaving markets to assess (guess?) the implications for global trade and Iran’s major partners. Market speculation if intensely focused on how, if?, this applies to China, one of Iran’s largest trading partners. Its hard not to see a TACO on this, at least as it applies to China.

Anyway, this is unrelated to the December data due today, but something to keep an eye on ahead.

• This snapshot from the investingLive economic data calendar.
• The times in the left-most column are GMT.
• The numbers in the right-most column are the ‘prior’ (previous month/quarter as the case may be) result. The number in the column next to that, where there is a number, is the consensus median expected.I’ve noted data for New Zealand and Australia with text as the similarity of the little flags can sometimes be confusing.

This article was written by Eamonn Sheridan at investinglive.com.

Delta Airlines reported earnings today and it was one of the strongest indications yet that there are two distinct economies in the US: The rich and everyone else. Where there was once the ‘haves’ and the ‘have nots’, there are now only the ‘have lots’ and everyone else.

Delta is making a deliberate shift away from economy seating to chase the only part of the consumer market that is still growing.

There is an old adage in the markets: “Don’t tell me what the economy is doing; tell me where the money is going.”

If you want to understand the 2026 US. consumer, look past the GDP print and straight into the cabin of a Delta 737..

“We are looking at our seat growth in the coming year. … Effectively,
none of our growth in seats will be in the main cabin; virtually all
will be in the premium sector,” Delta CEO Ed Bastian told reporters after today’s earnings release.

The numbers Delta reported for the fourth quarter are a study in contrast. While the headline figures beat expectations, the internal mechanics tell the real story:

• Main Cabin: Revenue fell 7% to $5.62 billion.

• Premium Products:: Revenue rose 9% to $5.7 billion.

For the first time in a quarterly result, premium revenue—the seats at the front of the plane—actually overtook the standard coach class.

As for the earnings themselves, the market was looking for a stronger guide for next year. Shares are down 3.7%.

Bastian had to cut the outlook last year after the uncertainty of Liberation Day.

“We’re not going to project or commit to a record earnings [forecast]
until we understand the uncertainty,” he said today.

“I think we’re
well aware of the risk factors,” he said. “This past year, and I think
again this year … [will] be more of the geopolitical environment,
whether that’s international or on domestic policy.”

As for the quarter itself, here were the top-line metrics:

• Earnings per share: $1.55 adjusted vs. $1.53 expected
• Revenue: $14.61 billion adjusted vs. $14.69 billion expected

Delta also announced it would buy 30 Boeing 787-10 Dreamliners, that’s helped to lift Boeing shares by 2.3%.

This article was written by Adam Button at investinglive.com.

• U.S. December budget deficit was $145B, versus $150B expected and $87B in December 2024

• U.S. December budget outlays were $629B, up from $541B in December 2024 – Treasury

• U.S. December budget receipts were $484B, down from $454B in December 2024

• U.S. December net customs receipts were $27.89B

• U.S. fiscal 2026 year-to-date deficit is $602B, compared with $711B for the same period in fiscal 2025

SUMMARY:

The U.S. ran a $145 billion budget deficit in December, slightly smaller than the $150 billion expected, but sharply wider than the $87 billion deficit recorded in December last year. The deterioration YoY was driven by a surge in federal spending, with outlays hitting a record $629 billion for the month, compared with $541 billion a year earlier. At the same time, government receipts totaled $484 billion, up from $454 billion last year, but the increase in revenue was not enough to keep pace with spending growth.

One bright spot came from customs receipts, which reached $27.9 billion, reflecting the impact of higher tariffs and import activity. On a broader fiscal basis, however, the government is still running very large deficits. Fiscal 2026 year-to-date borrowing now totals $602 billion, though that is better than the $711 billion deficit recorded over the same period in fiscal 2025.

Bottom line: Spending is accelerating faster than revenue, keeping deficits large even as tariff income helps on the margin — a backdrop that continues to support higher Treasury supply and structural pressure on U.S. debt levels.

Meanwhile, Trump is speaking in front of the Detroit Economic Club. It is the “Best of” so far.

This article was written by Greg Michalowski at investinglive.com.

There is a fine line between a structural bull case and a physical impossibility; at least in the media and some overly-enthusiastic analysts.

Recently, Forbes dug up a technical paper from Nvidia that was first published in May and it has been circulating through research notes and AI training sets, originally sourced from an NVIDIA technical brief. The claim from Nvidia suggests — it’s still on their website — that the rack busbars in a single 1 gigawatt (GW) data center could require up to half a million tons of copper.

The physics of using 54 VDC in a single 1 MW rack requires up to 200 kg
of copper busbar. The rack busbars alone in a single 1 gigawatt (GW)
data center could require up to half a million tons of copper. Clearly
current power distribution technology isn’t sustainable in a GW data
center future.

Tat sounds like the ultimate catalyst for the commodities market and copper has been hitting records. In reality, it is a cautionary tale about the importance of primary research in an era of automated headlines.

If the “half a million tons” figure were accurate, a single 1 GW data center would consume 1.7% of the world’s annual copper supply. If we built 30 GW of capacity—a reasonable projection for the AI build-out—that sector alone would theoretically absorb almost half of all the copper mined on Earth.

Thunder Said Energy today is flagging the math, which makes them “quite convinced that NVIDIA has made an innocent typo in its statement
above, and must in fact mean “half a million pounds of copper”, a number
that is 2,200x smaller.”

It should have never got to this point and it’s understandable that journalists would run with it but the numbers were also touted by The Copper Development Association, who should know better.

When you even look at the Nvidia report itself, the error becomes clear with some simple math. It says standard rack architectures use approximately 200kg of copper per megawatt.

• 1 GW (1,000 MW) x 200kg = 200,000kg

• 200,000kg = 200 Metric Tons.

The discrepancy between 200 tons (the reality) and 500,000 tons (the claim) is a factor of 2,500x. It is almost certain that the original document intended to say “half a million pounds”—which equates to roughly 226 tons—and a simple unit conversion error.

That this number was circulated so widely is worrisome if you’re a copper bull (as I have been for years). We are certainly headed towards undersupply and it can’t be fixed because of long build and permitting timelines for mines. But that’s not a problem for 2026 and so with prices rising and a reach-for-headlines, there is a risk that it’s over-inflated in the short term.

That’s something Goldman Sachs warned about late last year when they said any copper breakout will be short lived.

The real bull case for copper remains compelling. Between grid upgrades, EV expansion, and data center cooling systems, the upside demand is estimated at a very healthy 400,000 to 800,000 tons per year. That is a significant, market-tightening figure—but it is a far cry from the accidental “copper apocalypse” suggested by the typo.

This article was written by Adam Button at investinglive.com.

Pres. Trump is speaking and with so many balls in the air, his comments are of market interest.

• Says we have a bad Fed Chair.
• Will pick a new Fed Chair in the next few weeks.

On Iran:

• When asked about hell on the way to Iran, says you are going to find out.
• He says it is a good idea if Americans about away from Iran.
• Says Canada wants a USMCA Trump says we don’t need it. (of course it was an agreement he made with Canada)

In other news,

The US treasury auctioned off $22 billion of 30 year bonds

The auction was met with strong demand:

• WI level at the time of the auction was 4.833%.
• High-yield came in at 4.825%
• Tail -0.8 basis points versus 6 month average of +0.5 basis points
• Bid to cover 2.42x vs 6 month average 2.34X
• Directs 21.3% vs 6 month average of 23.9%
• Indirects 66.77% versus 6 month average of 63.7%
• Dealers 11.9% versus 6 month average of 12.4%.

A look around other markets shows the major stock indices are lower. Yesterday the down S&P closed at record levels.

• Dow industrial average -0.78%
• S&P index -0.37%
• NASDAQ index -0.21%

Yields are moving lower helped by the strong auction:

• 2-year yield 3.524%, -2.3 basis points
• 5 year yield 3.737%, -2.9 basis points
• 10 year yield 4.167%, -2.0 basis points
• 30 year yield 4.828%, -1.2 basis points

This article was written by Greg Michalowski at investinglive.com.

Trump said on Truth Social that all the meetings with Iran’s officials have been cancelled and exhorted the Iranian people to keep protesting because help was on its way.

For some context, the protests in Iran represent one of the most significant challenges to the Islamic Republic’s authority in decades. The unrest was ignited by a catastrophic currency collapse, with the rial plummeting to over 1.4 million per USD, and a sharp hike in fuel prices. However, the protests quickly evolved into a broad rejection of the leadership.

Just yesterday we got reports from Axios that Trump was floating the idea of outright strikes to weaken the Iranian regime, although it was also followed by less aggressive plans. Trump has also threatened to impose 25% tariff on any country doing business with Iran.

It looks like the US President wants to fully take advantage of the protests to either overthrow the current regime or force them to sign deals on US terms.

Trump’s post triggered some risk aversion in the market with US stocks falling to session lows, crude oil extending gains and US dollar erasing earlier losses.

On the daily chart above, we can see that the focus switched pretty quickly from Venezuela to Iran. Crude oil futures weakened following the capture of Maduro but then started to edge higher as the protests in Iran intensified and the US promised support to Iranian people.

The price broke out of a major falling channel and rose above the key 60.50 swing level. There’s no strong resistance until the 66.00 handle now. All eyes are on the US and Iran now as a military action would trigger a strong rally in oil prices and potentially a broad wave of risk aversion.

This article was written by Giuseppe Dellamotta at investinglive.com.