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China's trade surplus widens in June on slowing imports | China's trade surplus widens in June on slowing imports |
(40 minutes later) | |
China's trade surplus widened in June as import growth weakened, underscoring worries about both the domestic and global economy. | |
The trade surplus grew to $31.73bn (£20.46bn), up 42.9% from the same month last year, the customs bureau said. | The trade surplus grew to $31.73bn (£20.46bn), up 42.9% from the same month last year, the customs bureau said. |
The main contributor was weak imports which grew 6.3%, about half the pace analysts were expecting. | |
China's domestic economy has been one of the major drivers of global growth. | |
Trade conflict | |
China's trade surplus with the US and other countries has pitted it against its trading partners in recent years. | |
China has been a massive exporter of cheap goods and the country has been accused by some in the US of keeping its currency, the yuan, undervalued giving it a competitive advantage. | |
The allegations of 'currency manipulation' are a subject of heated debate in the US election campaign this year, with some criticising the current administration for being too soft on China. | |
"A large trade surplus continues to put pressure on the yuan to appreciate, otherwise there may be trade sanctions from trading partners and a conflict with the United States," Li-gang Liu from ANZ in Hong Kong. | |
China has allowed the yuan to appreciate at a very gradual pace, however critics say it is still undervalued. | |
Domestic worries | |
The data out on Tuesday have also highlighted recent concerns that slowing demand from Europe and the US will impact the Chinese economy. | |
Exports beat analyst expectations rising by 11.3%. However that is still down from 15.3% in May. | |
The data comes days after the Chinese Premier Wen Jiabao said China faces "relatively large" downward pressures. | The data comes days after the Chinese Premier Wen Jiabao said China faces "relatively large" downward pressures. |
Mr Wen also said authorities would intensify their response to any economic slowdown and encouraged exporters to explore markets in Asia. | |
Last week in a surprise move, the government cut borrowing costs for the second time in a month, raising concerns China may have posted weaker growth than expected in the second quarter. | Last week in a surprise move, the government cut borrowing costs for the second time in a month, raising concerns China may have posted weaker growth than expected in the second quarter. |
The official government report is due on Friday, and will include China's gross domestic product, fixed asset investment and industrial production. | The official government report is due on Friday, and will include China's gross domestic product, fixed asset investment and industrial production. |