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China’s trade surplus soars in June with imports growth slowing down

Monday, July 11th 2011 - 07:51 UTC
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Imports expanded at their weakest since November 2009 Imports expanded at their weakest since November 2009

China's trade surplus widened more than expected to 22.3 billion US dollars in June, the highest level in seven months, as imports grew at the slowest pace since 2009. The surplus was 13.1 billion USD the previous month and 20 billion USD a year earlier.

The surplus adds to the cash flooding the economy and complicates Premier Wen Jiabao's efforts to cool the fastest inflation in three years. Policy makers are seeking to rein in price gains that are stoking social discontent without choking off growth that's already showing signs of slowing.

The People's Bank of China has raised interest rates five times since mid-October, the latest on July 5, and increased banks' reserve requirements nine times since November to a record level to rein in liquidity. Consumer prices climbed 6.4% last month, the most in three years.

China's trade surplus in June was the biggest this year and the widest June gap since 2007. Exports climbed 17.9%, the least since December after excluding seasonal distortions from the Chinese New Year holiday, to a record 162 billion. The customs bureau released the data in an online webcast on Sunday.

Imports jumped 19.3% to 139.7 billion, the customs bureau said, the weakest expansion since gains resumed in November 2009 after a year-long decline. Analysts' median forecasts were for an 18.6% gain in overseas shipments and a 25.3% increase in imports.

China, the world's biggest consumer of energy, iron ore and soybeans, has seen its import bill surge over the past year as commodity costs climbed.

Higher global prices are increasing inflationary pressure in China, and led to a 14.7% increase in the overall price of imported commodities in the first half, Zhao Fudi, a customs bureau spokesman, said in an online broadcast on Sunday.

Import growth in June was held back by a 12% drop in net crude oil shipments, the first year-on-year decline since December, customs data show. At the same time, the average cost of crude imports in June was 110 USD a barrel last month compared with 77 USD a year earlier, the data show.
 

Categories: Economy, International.

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