… in a long time.
After 70 Months Of Trade Surpluses, China Records A $7.2 Billion Trade Deficit In March: Detailed Summary Of March Trade Data
Submitted by Tyler Durden on 04/10/2010 14:18 -0500
In March China recorded its first trade deficit after 70 straight months of trade surpluses, which has occurred even despite global calls that the Renminbi needs to be revalued by about 20%. The primary reason for this was that in March China imported a total of $119.4 billion worth of goods – the single greatest amount recorded in history. This was offset by $112.1 billion of exports, well below the record exports China was pumping out in late 2008 in the mid $130 billion range, and the $130.7 billion exported in December of 2009. Below we present a summary of the key highlights of China trade balance over the past 3 years. …
It is also notable that the Chinese trade balance hit an all time record deficit in its trade with Japan, which was $6.5 billion in March, more than double the $3.1 billion in February. …
Where the most notable change can be seen is the record surge in imports from the Rest of the World (ROW), which at $1.7 billion is likely to become a deficit number when the April trade balance is reported. To be sure, this is predicated by China’s ongoing surge in inventory rebuild from peripheral countries, which for the most part tend to be commodity exporters. Look for this series to be most sensitive to a plateauing of China’s inventory restocking efforts. Indeed, from July to December, when Chinese banks were cautioned about excess liquidity, this number increased from about $5 billion to $14 billion as China emphasized exporting. In 2010, with excess liquidity once again a core topic, this has materialized in a surge in imports, not only from the ROW but from most countries, and thus the trade deficit. …
Cherry-Picking the Comments:
LeBalance
on Sat, 04/10/2010
if you’ve been following their trade habits, “rich” China went about the world buying the contracts for “every” commodity from “every” grower, for the next N years. As such they have a long timeline now in which they plan to grow their “consumer-middle-class” and frankly they have been planning so for a loooong time.
Mazarin
on Sat, 04/10/2010 – 14:51
China the new champ at old Brit/US game of using your currency to “extract value” from the rest of the world.
meagain
on Sat, 04/10/2010 – 15:40
Looks like most of the deficit is changes in EU, ASEAN, and ROW. What should we make of that? Last time they had such a steep drop in those areas was March 09, after which there were extreme stimuli and easings. Not much stomach for that any more, or even much flexibility for more…
