Date
22 October 2018
China’s large trade surplus with the United States is at the center of an increasing bitter dispute between the world’s two biggest economies. Photo: Xinhua
China’s large trade surplus with the United States is at the center of an increasing bitter dispute between the world’s two biggest economies. Photo: Xinhua

China trade surplus with US hits record US$34.1 bln in September

China’s trade surplus with the United States surged to a record high of US$34.13 billion in September, compared with US$31.05 billion in August, Reuters reports, citing the latest Chinese customs data released on Friday.

The September surplus with the US was larger than China’s overall trade surplus of US$31.69 billion for the month.

For January-September, China’s trade surplus with the US was US$225.79 billion, compared with US$196.01 billion in the same period last year.

China’s large trade surplus with the US has long been a sore point with Washington and is at the center of an increasing bitter dispute between the world’s two biggest economies.

The US and China imposed new tit-for-tat tariffs against each other’s goods in late September, the latest escalation in a heated trade war between them.

China’s September exports rose 14.5 percent from a year earlier, blowing past forecasts for an 8.9 percent increase in a Reuters poll and well above August’s 9.8 percent gain.

Growth in imports for September instead showed a moderate slowdown to 14.3 percent from 19.9 percent in August, slightly missing analysts’ forecast of a 15.0 percent growth.

China’s export data has been surprisingly resilient to tariffs, possibly because companies ramped up shipments before broader and stiffer US duties went into effect.

A weaker yuan, which has depreciated about 6 percent against the dollar this year, may have taken the sting out of the tariffs imposed on US$250 billion of exports to the US.

Over the first nine months of the year, China’s surplus with its largest export market totaled US$225.79 billion, compared with US$196.01 billion in the same period last year.

Feeling the heat

For trade with all countries, China logged a surplus of US$31.69 billion for September, compared with forecasts in a Reuters poll for US$19.4 billion and August’s surplus of US$27.89 billion.

China’s economy is feeling the heat from a tit-for-tat tariff dispute and showing signs of slowing that prompted the central bank on Sunday to loosen policy by cutting banks’ reserve requirement ratio (RRR) for a fourth time this year.

A US Treasury official this week voiced concerns about China’s recent currency depreciation.

With China’s manufacturing sector cooling and export orders shrinking, Beijing has pledged to increase export tax rebates from Nov. 1 for the second time this year and promised to cut corporate burden on a larger scale to help struggling Chinese firms.

The International Monetary Fund on Tuesday cut its global economic growth forecasts for this year and next, saying that the U.S-China trade war was taking a toll. It also slashed China’s growth forecast for next year to 6.2 percent from 6.4 percent.

China will cut import tariffs on a wide range of goods beginning on Nov. 1, as part of Beijing’s pledge to take steps to increase imports this year amid rising tension.

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CG

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