China’s trade surplus falls to $16.9b

The gap between China’s imports and exports narrowed in September, official data has shown.

But analysts say the decline is unlikely to ease the pressure on Beijing to strengthen its currency.

The US has been among its strongest critics, claiming China deliberately undervalues the yuan, boosting China’s exports by making them cheap.

China’s trade surplus fell to a five-month low of $16.9bn (£10.7bn), down from $20bn in August.

Exports rose 25.1% year-on-year in September to $145bn, but the pace of growth was slower than the 34.4% growth seen in August.

Imports rose 24.1% year-on-year to a record high of $128.1bn, compared with August’s growth of 35.2%.
‘Plenty of scope’

Despite the data, Brian Jackson, senior strategist at Royal Bank of Canada in Hong Kong, said that China would still be under pressure to let the yuan appreciate.

“I think the fact that their exports are still very strong suggests that there’s plenty of scope for them to do more on the currency,” he told the AFP news agency.

In June, China pledged to let the yuan trade more freely against the dollar. Since then it has advanced about 2% against the US currency.

But the US has pressed for China to do more to allow the yuan to appreciate.

The House of Representatives has backed a bill that treats undervalued currencies as illegal export subsidies, which could pave the way for trade sanctions on China.

Beijing has said it is “resolutely opposed” to the bill.
Source: BBC