China’s trade surplus widened for a fifth month last month as export growth remained solid and imports moderated, keeping the spotlight on a trade gap US President Donald Trump aims to narrow.
Exports rose 7.2 percent in US dollars as imports increased 11 percent, both falling short of economist projections.
The trade surplus widened to US$46.7 billion.
Shipments to the US rose 8.9 percent versus 19.8 percent in June, narrowing the trade surplus with the world’s biggest economy slightly to US$25.2 billion
Demand for Chinese products has remained resilient as growth in major trading partners continues to recover. At home, stronger-than-expected output is supporting robust import demand.
Yet the world’s largest exporter confronts more uncertainty as Trump continues sporadic tough talk on trade. The White House might be considering a probe of alleged intellectual property violations, which could risk igniting trade tensions.
“Overall exports and imports are still resilient,” Raymond Yeung (楊宇霆), chief greater China economist at Australia & New Zealand Banking Group Ltd in Hong Kong, said in a Bloomberg Television interview.
“The trend improvement in Chinese trade data — and more specifically in Chinese imports — appears to have peaked and is rolling over,” Callum Henderson, a managing director for Asia-Pacific at Eurasia Group in Singapore, said in an e-mail.
“Exports slowed in July, a reminder that despite robust demand the world’s factory has limited scope to grab increased market share,” Bloomberg Intelligence economists Tom Orlik and Fielding Chen wrote in a report. “If exports now come off the boil, that would provide additional reason for caution on deleveraging.”
“China’s trade surplus actually is heading downward if you look at a year-on-year comparison,” said Gai Xinzhe, an analyst at Bank of China’s Institute of International Finance in Beijing. “In the meantime, the July figures give China a little better position at the negotiation table with Trump. Clearly, China can say we have done much work to balance our trade relations, and here are the numbers.”
Crude imports fell to the lowest in six months. Iron ore imports rose 7.5 percent on-year in the January-to-July period. Natural gas imports jumped 20.7 percent in the same period.
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
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