China December exports unexpectedly drop

China's 2018 trade surplus with U.S. highest on record going back to 2006

China December exports unexpectedly drop

Imports increased 15.8 percent past year, resulting in a trade surplus of $351.76 billion, the country's lowest since 2013.

Customs data showed that Chinese exports rose 11.3 percent in 2018 to $478.4 billion, while imports from the U.S. only rose by 0.7 percent.

China's trade surplus with the USA widened a year ago, while the country's imports and exports fell in December as the trade war begins to bite in the world's second biggest economy.

In 2018, the United States imposed billions of dollars worth of tariffs on Chinese products, prompting retaliation from Beijing and a trade war that analysts fear could escalate further and damage the global economy.

China's global exports rose 7.1 percent to $2.5 trillion, down from the 7.9 percent rate reported earlier for 2017.

Import growth had been expected to pick up slightly to 5 percent, after cooling to 3 percent in the previous month.

But the buying fell off past year after China imposed a 25% retaliatory tariff on the commodity in the summer.

However, Beijing's export data had been surprisingly resilient to tariffs for much of 2018, possibly because companies ramped up shipments before broader and stiffer US duties went into effect.

But December's gloomy data seemed to suggest the US front-loading effect has tapered off, and after several months of falling factory orders a further weakening in China's exports is widely expected in coming months.

"The global electronics cycle remains the key driver of Chinese exports".

In December alone, China's trade surplus with the USA was $29.87 billion.

The figures come after a United States delegation held three days of talks in Beijing last week in the first face-to-face meeting since Donald Trump and Chinese leader Xi Jinping in December pledged a 90-day truce to resolve the crisis.

China's government reports 2018 exports rose 7.1 percent as a trade battle with Washington intensified, while imports were up 12.9 percent.

Early this month, the central bank said it would slash banks' reserve requirements - the fifth such cut in a year - as it tries to encourage more lending and reduce the risk of a sharp slowdown.

In an annual meeting of top leaders last month, China said it will boost support for the economy in 2019 by cutting taxes and stepping up policy adjustments.

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