Contrary to expectations, China’s exports increased in July, but imports declined year-on-year, according to Chinese customs authorities on Thursday.
Analysts predicted a 2 percent decline in Chinese exports in July after a 1.3 percent drop in June, but exports rose 3.3 percent last month, the best since April.
Imports continued to decline for the third month, but declined from 7.3 percent in June to 5.6 percent in July, lagging behind the expected 8.3 percent.
China’s foreign trade balance was up $ 45.06 billion in July, down slightly from last month’s $ 50.98 billion surplus, analysts had expected $ 40 billion. China’s trade surplus increased 60 percent year-over-year.
In the particularly sensitive US, the foreign trade surplus remained unchanged at $ 28 billion, up from June.
US imports of goods fell 19 percent to $ 10.9 billion on an annualized basis. In June, it fell even higher, 31.4 percent.
Chinese exports to the United States also declined, down 6.5 percent to $ 38.8 billion. In contrast, Chinese shipments to Europe, South Korea, Taiwan and Southeast Asia showed an increase in value.
Following the June “ceasefire,” the US-China trade conflict, which has escalated last week, may not yet be reflected in July figures. On September 1, Washington imposed a 10 percent surcharge on $ 300 billion worth of Chinese non-punished Chinese goods, which Beijing promised to retaliate against. China suspended supplies of US agricultural products this week, and the central bank on Monday allowed the Chinese currency to fall below the $ 7 / $ psychological threshold, and for the first time since Thursday set its average exchange rate below that level.
Analysts are currently not optimistic about a bilateral trade deal, although negotiators between the two countries will meet again in September in the United States.
According to US Goldman Sachs, a trade agreement between China and the United States is not expected until next November’s US presidential election, while Morgan Stanley, a US investment bank, thinks that a customs war between the two powers could crush the global economy by mid-next year.