Morgan Stanley(US:MS)2025-04-15 06:22Investment Rating - The report indicates a cautious outlook for exports, expecting growth to slip below 5% year-on-year in April 2025 [5][8]. Core Insights - Exports surged year-on-year in March 2025, but this is attributed to normalization from the residual effects of the Lunar New Year seasonality rather than a genuine improvement in underlying momentum [3][8]. - The first quarter of 2025 saw export growth decrease to 5.7%, down from 9.9% in the fourth quarter of 2024, influenced by fading front-loading and tariffs related to Fentanyl [3][8]. - Imports showed modest recovery with a growth rate of -4.3% in March 2025, compared to -8.4% in January-February, primarily affected by significant declines in iron ore and coal imports [4][8]. Summary by Sections Exports - March 2025 exports reached $314 billion, showing a year-on-year growth of 12.3%, but the underlying momentum is weakening [7]. - Exports to the US decreased from 10.5% growth in Q4 2024 to 5.0% in Q1 2025, indicating a shift in performance [3][7]. Imports - Total imports in March 2025 were $211 billion, with a year-on-year decline of 4.3% [7]. - Key products contributing to import declines include iron ore (-27%) and coal, reflecting ongoing steel production cuts [4][7]. Outlook - The report anticipates that export growth will soften further due to substantial US tariffs on China, although front-loading in supply-chain trade and electronics may provide some short-term relief [5][8]. - The front-loading of the National People's Congress's RMB 2 trillion stimulus is expected to mitigate the impact of tariffs in the second quarter of 2025 [8].