China posts $47.3 bn trade surplus in July

08 Aug 2014


China has recorded monthly trade surplus of $47.3 billion in July, compared with $17.8 billion during the same month last year, official data showed on Friday.

China's previous record monthly surplus was $40.1 billion in November 2008.

Exports from the world's second-largest economy increased 14.5 per cent year-on-year to $212.9 billion, the General Administration of Customs said, while imports decreased 1.6 per cent to $165.6 billion.

Export growth accelerated from June's gain of 7.2 per cent; however, imports, which had gained 5.5 per cent in June, shrank.

According to analysts, the surplus suggested 'the appreciation pressure on Chinese currency will likely increase' if the central bank does not intervene actively in the foreign exchange market.

July's mixed results come as China's economic activity has picked up steam since authorities introduced measures to shore up growth after it slowed at the beginning of the year. Since April, they have introduced measures including tax breaks for small enterprises, targeted infrastructure outlays and incentives to encourage lending in rural areas and to small companies.

China's gross domestic product (GDP) accelerated to a 7.5 per cent in the second quarter, up from 7.4 per cent in the previous three months, which was the worst since a similar 7.4 per cent expansion in July-September 2012.

The government in March set its annual GDP growth target for 2014 at about 7.5 per cent, the same as last year.

The trade data came after surveys of China's manufacturing sector showed that activity increased sharply in July, with the official purchasing managers' index (PMI) reaching its highest level in more than two years. A closely watched private PMI survey came in at an 18-month high.

Despite recent signs of vigour in the economy, economists have expressed concern about the potential for China's vast and opaque property sector to dent growth expectations.

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