China’s trade surplus narrows in August

| September 10, 2010 | 0 Comments
China’s trade surplus narrows in August

China’s trade surplus narrowed to $20 billion (£13 billion) last month as imports surged ahead.

However, August still represented the third consecutive month in which China’s trade surplus exceeding $20 billion.

Imports soared 35.2% on an annual basis - far exceeding the 26.1% expected by analysts.

Meanwhile, exports slowed to 34.4% on an annual basis, down from the 38.1% reported in July - but closer to expectations of a 35% rise.

The figures come just a day after the Commerce Department announced the US trade deficit narrowed in July by 14% to $42.8 billion (£27.8 billion) from $49.90 billion the previous month.

Returning to China, the central bank allowed the yuan to appreciate against the dollar today to its strongest level since Beijing loosened its currency peg in June.

The US has previously expressed dissatisfaction that China is keeping the value of the yuan low to help its exporters at the expense of overseas competitors.

Trade groups have argued that the yuan, also referred to as the renminbi, is kept up to 40% below what its value should be against the US dollar.

However, Beijing has previously said keeping the yuan stable is “an important contribution” to global recovery.

US lawmakers will hold hearings next week since many believe Beijing should be punished for maintaining an unfairly undervalued yuan.

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