- The trade surplus narrowed to USD 0.87 Bn in February 2024, much lower than consensus, as exports surprised to the downside while imports was on the upside.
- Exports suffered from low demand from China due to the Chinese New Year, which dampened industrial activities temporarily but is likely to recover along with a dose of stimulus.
- Imports remain strong, especially for consumer goods. This was driven by the Election effect, continued rice imports, and anticipation of Ramadan.
- The narrow surplus might be just a one-off due to the festive seasons and could recover in March, but we maintain our case for modest CA deficit which necessitates BI to stay quite conservative.
