China surprised the market with a robust growth in exports and posted a record trade surplus with the US amid an escalating trade dispute between the world's two largest economies.
China's dollar-denominated exports surged 14.5 per cent in September from a year ago, beating an expectation of 8.9 per cent growth and significantly higher than a growth of 9.8 per cent in August, according to the data released by the state customs on Friday.
Its imports grew 14.3 per cent from a year ago, missing analysts' predictions of a 15 per cent growth and slowing from a growth of 19.9 percent in August.
In particular, China's exports to the US rose 16.6 per cent year-on-year in September, and its imports from US increased 1.6 per cent from a year earlier.
That brought China's trade surplus with the US to $34.13 billion amid intense trade tensions between the world's two largest economies, according to Reuters calculations based on official data.
Economists say the phenomenon is mostly due to exporters benefiting from increased orders before the tariffs hit, but the figures are likely to show stress in the months ahead.
A weaker yuan which has depreciated about 6 per cent against the dollar this year, may have helped hold up the exports hit by tariffs imposed on $250 billion of exports to the US.
For trade with all countries, China logged a surplus of $31.69 billion for September, compared with forecasts for $19.4 billion and August’s surplus of $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.
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.
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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