China reported a less-than-forecast $13.1 billion trade surplus for December, bolstering the nation’s bargaining position ahead of a January 19 meeting where US President Barack Obama may press for more gains in the yuan.
The gap compared with the $20.8 billion median estimate of 20 economists surveyed by Bloomberg News and November’s $22.9 billion. Exports rose 17.9 per cent to $154.2 billion from a year earlier and imports climbed 25.6 per cent to $141.1 billion, the customs bureau said on its website today.
Today’s figures support China’s case that the nation is contributing to global economic rebalancing by ramping up domestic consumption. The full-year trade gap narrowed 6 per cent to $183.1 billion even as exports and imports rose to records in December.
China “lowered last year’s whole-year trade surplus to around 3 per cent of gross domestic product, from the 2007 peak of over 11 per cent,” said Qu Hongbin, a Hong Kong-based economist for HSBC Holdings. “In other words, China has already rebalanced its trade surplus, weakening the case for a fast renminbi appreciation,” Qu said, using another word for the yuan.
The yuan fell for a fifth day, declining 0.1 per cent to 6.6345 per dollar as of 3.18 pm.
Domestic demand
The surplus was the smallest since April. The increase in exports was less than economists’ 23.3 per cent median estimate and compares with a 35 per cent gain in November.
Import growth compared with a forecast of 24.9 per cent and the 38 per cent increase in the previous month. A higher comparative base a year earlier may have pared gains in both imports and exports.
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“The data points to continued solid foreign demand, and very strong domestic demand,” said Dariusz Kowalczyk, a Hong Kong-based economist at Credit Agricole CIB. A “smaller-than- expected surplus means less appreciation pressure on the yuan,” he said.
Rising raw-material costs may have boosted imports, Goldman Sachs Group said in a note.
China’s government has indicated that it will renew efforts to boost domestic consumption in the nation’s next five-year plan, running from this year through 2015. Already, China is the world’s biggest car market.
The nation’s vehicle and vehicle chassis imports rose almost 50 per cent to $3.42 billion in December from a year earlier, today’s data showed.