China's imports have fallen sharply at the start of this year, as the prospect of a trade war with the US hits its economy. Imports fell 8.4% year on year in January and February, customs data shows, weaker than the 1% growth expected by economists. That suggests that China’s manufacturing base could be cutting back on buying raw materials and parts, concerned that demand for their wares would fall because of new tariffs at the US border. China’s exports rose, though, in the first two months of 2025 – up 2.3%. Exports to the US rose to almost $76bn, Bloomberg reports, the highest total for January and February since 2022 when the Covid-19 pandemic was upending global trade. The Chinese foreign minister, Wang Yi, said China would continue to retaliate over the US “arbitrary tariffs” and accused Washington of “meeting good with evil”, in a press conference Friday on the sidelines of the country’s annual parliamentary session. Wang said China’s efforts to help the US contain its fentanyl crisis have been met with punitive tariffs, which are straining their ties. “No country should fantasise that it can suppress China and maintain a good relationship with China at the same time,” Wang said. “Such two-faced acts are not good for the stability of bilateral relations or for building mutual trust.” The markets continue to be buffeted by fears of a global trade war, as Donald Trump vacillates over the imposition of tariffs on major US trading partners. Last night in New York the S&P 500 index fell 1.8% to its lowest level since early November – the post-election Trump bump has well and truly vanished. Tech stock slid, pushing the Nasdaq index into a correction (more than 10% below its record high). Wall Street’s fear index, the CBOE Volatility Index, closed at its highest level since 18 December, showing investors are jittery. They may also be flummoxed, after Trump temporarily delayed tariffs on many goods from Canada and Mexico yesterday. European stock markets are expected to drop today, with the FTSE 100 index forecast to fall 0.55% or 48 points. Japan’s Nikkei has fallen more than 2% today, to its lowest level since last September. Investors are poised for the latest US jobs report. The consensus is that hiring picked up in February, lifting non-farm payrolls by about 160,000 last month. The agenda • 10am GMT: eurozone GDP Q4 2024 (3rd estimate) • 1.30pm GMT: US non-farm payroll for February We'll be tracking all the main events throughout the day …
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