Published: Sat, July 14, 2018
Worldwide | By Myra Stephens

China trade surplus with USA widens unexpectedly

China trade surplus with USA widens unexpectedly

Separate data suggested some Chinese retailers moved up orders to the insulate themselves from the intensifying trade war that threatens to send up costs on a growing number of consumer products.

Analysts expect to see the impact of the tariffs in the coming months, warning of a less favorable trade balance for China.

The expanding trade surplus was largely because of smaller imports.

The difference between China's exports to the United States and its imports from the world's largest economy expanded to a monthly high of $29bn (£22bn), up from $24.6bn in May.

Official data shows China's monthly trade surplus with the USA was almost 29-billion-dollars.

In turn, the Trump administration accused China of not negotiating "seriously" on trade and released on Tuesday a list of $200 billion worth of Chinese exports that could be subject to new 10-percent tariffs.

In the first half of the year, Chinese exports to the US increased 13.6 percent as compared to the same period in 2017, while imports from the USA only rose 11.8 percent.

Last Friday, Trump rolled out 25% tariffs on $34 billion of Chinese goods.

Thus far, China has imposed retaliatory tariffs on $34 billion-worth of US imports, targeting politically sensitive goods such as soybeans. So far, encouraged by strong job growth and expectations of good quarterly earnings reports, United States markets have been strong and the Australian market has reached a 10-year record high.

Not unexpectedly, several readers have expressed concern about the possible impact of the introduction of new USA tariffs on Chinese, Canadian and European imports on Australian and world share markets.

South Korea, Asia's fourth-largest economy, warned on Thursday that components and materials used in home appliances, computers and communications devices could be caught in the crossfire of the trade war.

In yuan terms, China's exports grew 3.1% in June and imports rose 6.0%. They said as a effect figures for July and August were likely to show a decline in exports to the US.

The spiraling battle between Beijing and Washington shows no signs of cooling down.

The data could renew longstanding criticism from the United States and Europe that the world's top metal producer is selling its surplus product overseas, hurting foreign rivals.

"We expect the trade numbers for July to disappoint since that's when the first round of USA tariffs took effect", China analyst at Nordea Bank in Singapore Amy Zhuang told the BBC.

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