06:45 AM EDT, 03/10/2026 (MT Newswires) -- The main economic data release overnight Monday was the latest trade report from China for February, said MUFG.

The report revealed that exports jumped by 21.8% year over year in the January-February period up from an increase of 6.6% in December, wrote the bank in a note to clients.

The combined reading for January and February helps to smooth out distortions from the Lunar New Year holidays, pointed out MUFG.

Shipments to the United States fell by 11% year over year in January-February, down from a 30% drop in December, and by 20% in 2025 as a whole.

In contrast, exports to non-U.S. destinations rose by 27.1% year over year in January-February, up from 12.9% in December. The breakdown by destination revealed that exports to the European Union increased by 27.8% year over year in January-February, and by 29.5% year over year to Southeast Asian Nations (Asean) countries.

The report highlights that China's trade continues to hold up better than expected despite disruption from U.S. tariffs, stated MUFG. Tariffs on exports to the U.S. have fallen recently as well after the Supreme Court ruled that President Donald Trump's IEEPA tariffs were illegal.

The reduction in tariff risks to trade had been encouraging policymakers in China to allow the renminbi (CNY) to strengthen more against the US dollar (USD) this year prior to the Middle East conflict, according to the bank.

The risk of an energy price shock for China's economy is likely to dampen upside momentum in the near-term, although the central bank (PBoC) set a stronger-than-expected daily fix overnight Monday at just below the 6.9000 level, added MUFG.