China’s trade surplus ballooned to US$28.7 billion last month as exports hit a record high, the government said yesterday — data likely to intensify pressure on Beijing for a stronger yuan.
The nation posted its biggest trade surplus since January last year as the value of China’s overseas shipments reached a monthly record US$145.52 billion last month despite slower export growth, customs authorities said.
The data suggested China had so far seen little impact from the European debt crisis and weak recovery in the US, as consumers continued to snap up Chinese-made televisions, T-shirts and leather shoes.
PHOTO: AFP
Last month’s trade surplus compared with a surplus of US$20.02 billion in June and surpassed analyst expectations for US$19.6 billion.
It also marked a sharp turnaround from March, when the country recorded a trade deficit.
Exports grew 38.1 percent from the same period a year ago, but slower than in June, when they were up 43.9 percent as steelmakers and raw material producers accelerated shipments before Beijing scrapped tax rebates on certain products.
China said last month that exports would slow in the second half of this year because of uncertainties overseas.
Policymakers were likely to resist any outside pressure to let the Chinese currency appreciate too quickly against the dollar, using the slowdown in export growth as their justification, experts said.
Imports gained 22.7 percent year-on-year to US$116.79 billion last month, marking a sharp slowdown in the pace of growth from June, when imports rose 34.1 percent.
It was the fourth-straight month that year-on-year growth in imports has slowed.
“In the United States we still have unemployment close to 10 percent and data out later this week will likely show another huge trade deficit of more than 40 billion dollars,” said Brian Jackson, a senior analyst at Royal Bank of Canada in Hong Kong. “This contrast in the trade position of the two most important economies in the world will likely increase the pressure from Washington for Beijing to allow further currency appreciation.”
Beijing pledged in mid-June to let the yuan trade more freely against the dollar, though it ruled out sharp fluctuations in the value of the currency.
Since then, the yuan has gained less than 1 percent against the greenback.
“The seasonal rise in the trade surplus during the remainder of the year, and expected slowing in year-ago export growth is unhelpful for foreign exchange policy,” said Ben Simpfendorfer, economist at Royal Bank of Scotland in Hong Kong. “The two developments will only add to Washington’s insistence on a stronger yuan and Beijing’s resistance.”
The National Bureau of Statistics announced separately yesterday that property prices continued to slow last month, as efforts to curb speculative investment in the real estate sector started to bite.
Housing prices in 70 major cities rose 10.3 percent year-on-year last month, the statistics bureau said, down from 11.4 percent in June.
The figure marked the third-straight month that year-on-year growth in prices has slowed after Beijing issued a slew of measures to prevent the real estate sector overheating and causing a bubble that could derail the economy.
On a monthly basis, property prices were unchanged from June, the statistics bureau said.
“House price inflation is slowing and should continue to ease further in the months ahead, but so far it has been a gradual deceleration rather than an abrupt correction in prices,” Jackson said.
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