China posted its weakest trade figures for six months overnight, as the economy suffers in the face of weak demand at home and abroad.
Both exports and imports dropped in the year to August, falling well below economists' expectations and proving the world's second largest economy is not immune from the global growth slowdown.
Analysts had expected exports to fall by 3.5 per cent in dollar-terms, though they actually tumbled by 10 per cent. Meanwhile, imports also dropped by 1.9 per cent, against predictions for a one per cent rise.
The poor trade figures come after a string of warnings from leading bodies including the World Trade Organisation (WTO) and the International Monetary Fund (IMF) that trade is expected to grow slower than GDP for the first time since the financial crisis in 2016.
Despite the sharp drop in exports, China still posted a $41bn trade surplus. That was down from $52bn recorded in July and the lowest level since March.
Commentators cautioned against reading too much into the one-month statistics which can be volatile.
Chris Scicluna, analyst at Daiwa capital markets, said: "The weakness to a large extent reflected one-off factors associated with the timing of national holidays and the G20 summit."
UBS' Paul Donovan added: "The effect was exaggerated by moves in the currency." On yuan-terms exports dropped by only 5.6 per cent and imports actually rose by 2.2 per cent.
Others, however, noted the ripples spreading through financial markets as a result of the weak figures and suggested a string of poor trade data could imply a sharper slowdown than expected.
"This could be an early sign that the recent recovery in economic activity is losing momentum," said Capital Economics' Julian Evans-Pritchard.
The FTSE 100 was down this morning with mining companies slipping on the prospect of weaker demand from Chinese manufacturers, while stock markets across Asia were also off in overnight trading.