China trade sur­plus with U.S. hits record

Greenwich Time - - BUSINESS -

China’s trade sur­plus with the United States widened to a record $34.1 bil­lion in Septem­ber as ex­ports to the Amer­i­can mar­ket rose by 13 per­cent over a year ear­lier de­spite a wors­en­ing tar­iff war.

Ex­ports to the United States rose to $46.7 bil­lion, down from Au­gust’s 13.4 per­cent growth, cus­toms data showed Fri­day. Im­ports of Amer­i­can goods in­creased 9 per­cent to $12.6 bil­lion, down from 11.1 per­cent.

Chi­nese ex­ports to the United States have at least tem­po­rar­ily de­fied fore­casts they would weaken af­ter be­ing hit by puni­tive tar­iffs of up to 25 per­cent in a fight over Amer­i­can com­plaints about Bei­jing’s tech­nol­ogy pol­icy.

“Ex­ports con­tin­ued to defy U.S. tar­iffs last month but im­ports strug­gled in the face of cool­ing do­mes­tic de­mand,” said Ju­lian Evan­sPritchard of Cap­i­tal Eco­nom­ics in a re­port. “We ex­pect both to soften in the com­ing quar­ters.”

Septem­ber marked the sec­ond straight record Chi­nese monthly trade sur­plus with the United States af­ter Au­gust’s $31 bil­lion.

Ex­port num­bers have been buoyed by pro­duc­ers rush­ing to fill or­ders be­fore Amer­i­can tar­iffs rose, but they also ben­e­fit from “ro­bust U.S. de­mand” and a weaker Chi­nese cur­rency, which makes their goods cheaper abroad, said Louis Kuijs of Ox­ford Eco­nom­ics in a re­port.

The yuan has lost nearly 10 per­cent of its value against the U.S. dol­lar this year. That prompted sug­ges­tions Bei­jing might weaken the ex­change rate to help ex­porters, but that might hurt China’s econ­omy by en­cour­ag­ing an out­flow of cap­i­tal. The cen­tral bank has tight­ened con­trols on cur­rency trad­ing to head off fur­ther de­clines.

China’s over­all ex­port growth ac­cel­er­ated, tem­po­rar­ily de­fy­ing fore­casts of a slow­down as the global econ­omy and con­sumer de­mand cool.

Ex­ports rose 14.5 per­cent over a year ear­lier to $226.7 bil­lion, up from Au­gust’s 12.2 per­cent growth. Im­ports grew 14.3 per­cent to $195 bil­lion, down from the pre­vi­ous month’s 20.9 per­cent rate.

Ex­ports to the 28-na­tion Euro­pean Union, China’s big­gest trad­ing part­ner, rose 11.6 per­cent to $37.4 bil­lion. The Chi­nese trade sur­plus with Europe was $12.7 bil­lion.

Chi­nese lead­ers have re­jected pres­sure to scale back plans for state-led de­vel­op­ment of global cham­pi­ons in ro­bot­ics and other tech­nolo­gies.

Wash­ing­ton, Europe and other trad­ing part­ners com­plain those vi­o­late Bei­jing’s free-trade com­mit­ments and U.S. of­fi­cials worry they might erode Amer­i­can in­dus­trial lead­er­ship. But com­mu­nist lead­ers see their in­dus­try plans as the path to pros­per­ity and global in­flu­ence.

As ten­sions mounted, Bei­jing agreed in May to nar­row its trade gap with the United States by pur­chas­ing more Amer­i­can soy­beans, nat­u­ral gas and other ex­ports. Chi­nese lead­ers scrapped that deal af­ter Trump’s first tar­iff hikes hit.

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