China trade surplus jumps to US$31.7bn

This widening will provide support for further RMB appreciation in case of globale economic improvement.

According to OCBC, China’s trade surplus widened to US$31.7bn from US$18.7bn, providing support for further RMB appreciation should global sentiment improve. June imports grew slower than expected at 6.3% yoy, led by falling commodity prices and weakening domestic demand, while export growth remained steady at the pace of 11.3% yoy. 

The IMF lowered its forecast for China’s medium term current account surplus as a percentage of GDP to 4-4.5% and softened its tone on RMB value. The IMF said the RMB is “moderately undervalued” against a basket of currencies after years of appreciation.