Exports weakened in March. That comes after some mild outperformance in January and February, and our leading indicator suggests a floor should be close. That said, it was a surprise that exports to China continued to fall in March, which is a warning that the recovery there still isn't strong.

On a sequential basis, both imports and exports rebounded early in 2023, with the rise in imports particularly strong. There's probably some downside left in YoY trends for both, but the floor should be close, particularly for exports, with some rebound thereafter.

What happened on East Asia Econ last week.

Imports have fallen, allowing the trade deficit to narrow. Exports are going sideways. Our regional export leading indicator has started to lift, which should benefit Japan. But for export performance to improve materially, Japan's auto sector needs to perform more strongly.

Wage growth is quite strong in Taiwan, particularly relative to the weakness of the manufacturing cycle. So far, the strength is more apparent in manufacturing. It will become more important for inflation if it starts to show up in services, where productivity growth is slower.

Property prices rose in February for the first time in 17 months, consistent with other data suggesting the market has reached a floor. Interest rates indicate upside, but buyer sentiment has been weak. We are waiting for the PBC's Q1 depositor survey to get a sense of change in that cautiousness.

Import price inflation continues to slow, as does consumer lending, but there was a sharp bounce in employment in February. That doesn't look cyclically driven, but still, it means the BOK will likely remain hawkish for the moment.

Official activity data for Jan-Feb were soft, with retail sales growing by just 3.7% annualised. Through January at least, China had yet to escape fully from the shadow of zero covid, so there should be more recovery ahead. But given the recession last year, the pace of recovery seems soft.

The BSI reinforces recent themes: that growth should be a bit stronger in the next few months, and that the labour market should finally get back to pre-covid levels of tightness.

This is what happened on East Asia Econ this week.

The Economy Watchers Survey was better again in February. So maybe the recovery is a bit stronger than our last assessment of 6/10. But Q4 GDP growth was weak, so the recovery is still young, and so it seems unlikely the new BOJ leadership will want to move policy too much.