The most-hyped economic event of the year was when for one month China actually showed a trade deficit.That was back in May that it was announced, but it was a joke, purely an artifact of seasonal patterns and the Lunar New Year. Still a lot of folks ran with it, as though it was a big deal, calling for an imminent DEVALUATION of the yuan.
China’s trade surplus widened to the highest this year and exports climbed more than estimated to a record in June, adding pressure on the government to let the currency gain after the U.S. said the yuan “remains undervalued.”
The gap increased 140 per cent to $20.02 billion from a year earlier, the nation’s customs bureau said yesterday. That compares with the $15.6 billion median estimate of 24 economists Bloomberg News surveyed. Exports surged 44 per cent and import growth moderated for the third month, rising 34 per cent.
So yeah, so much for that rebalancing that everyone was talking about, and so much for an end to the yuan revaluation pressure.
Of course, the takeaway isn’t all negative. Exports surged 44%! Feel free to keep worrying about your collapsing Baltic Dry Index.
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