There are tentative signs from several Asian economies that exports are starting to recover. Shipments from Asia ex-Japan are still a fifth below their level of a year ago. However, the pace of decline has stabilised since January and export values increased in March relative to a month earlier, the first such rise since July. In short, there is cause for optimism. But this was no ordinary downturn and the recovery will throw up surprises. In particular, it is unclear whether signs of life in current trade reflect a revival of final demand or a correction after destocking and problems in trade finance caused the slowdown in global trade to overshoot at the end of last year. The jury is out, but we fear that the apparent demand growth now being seen could prove to be an illusion.
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