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China: China tallies yet another record trade surplus in August

September 8, 2014

In August, exports increased 9.4% over the same month last year. Although August’s print represented a deceleration over the 14.5% expansion tallied in July, it slightly overshot the 9.0% increase that market analysts had expected. Imports, however, declined further in August, falling 2.4% annually. The monthly drop followed the 1.6% decline observed in July and defied the 3.0% expansion that market analysts had expected. In addition, August’s print marked a five-month low.

As exports outperformed and imports declined in August, the trade balance recorded an all-time record surplus of USD 49.8 billion (July: USD 47.3 billion surplus), which was well above the USD 28.5 billion surplus recorded in the same month last year. The print exceeded market expectations of a USD 40.0 billion surplus. The 12-month moving sum of the trade surplus rose from USD 284 billion in July to USD 305 billion in August, which represented the highest level since May 2009.

Analysts believe that the strong export readings recorded in recent months mostly reflect a healthy economic recovery in the United States, while weak imports underline China’s lackluster domestic demand. In addition, the large trade surpluses observed in July and August will add more appreciation pressure on the Chinese yuan.

The government set the growth target for the total volume of exports and imports at 7.5% for this year. FocusEconomics Consensus Forecast panelists project that merchandise exports will grow 6.6% in 2014 (USD 2.4 trillion) and they see the trade surplus reaching USD 271 billion. For 2015, the panel expects exports to increase 8.8% and the trade surplus to widen to USD 287 billion.


Author: Ricard Torné, Lead Economist

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China Trade12m August 2014 0

Note: 12-month sum of trade balance in USD billion and annual variation of the 12-month sum of exports and imports in %.
Source: General Administration of Customs of the People’s Republic of China and FocusEconomics calculations.


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