Chinese Surplus Exceeds Forecasts While Australian Dollar Steadies
By Anatol Thomas
The Chinese economy is the second largest economy in the world and it has a huge trade surplus with the USA. President Donald Trump had been criticizing China for its trade surplus during the election campaigns. However, the protectionist policies of Trump against China have mellowed down mainly because Trump expects the Chinese support in dealing with North Korea.
The trade surplus report of Yuan in April was 262.3 billion. It is a huge rise from 164.3 billion in March. The expectations were around 197 billion. The report proved that the trade surplus was much larger than expected. The Chinese exports grew by 14.3% while the experts expected a 16.8% rise. Similarly, the imports increased by 18.6% while the expectations were 29.3%.
The Chinese export outlook may not be a problem for the economy now because the US is not interested in starting a trade war with China. The International Monetary Fund has increased its global demand forecast which will be beneficial for China. The import levels of China are closely monitored by the investors as it indicates a domestic demand.
The Australian dollar is closely connected with the Chinese market due to the strong export relationship between Australia and China. The release of the Chinese economic outlook hasn’t affected Australian dollar. As a result, the Australian dollar remained steady after the release of Australian construction data. The AUD/USD pair was trading at 0.73960 on Monday. The overall value of the Australian dollar didn’t deviate from the previous sessions.
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