Introduction: China’s trade surplus hits $1tn
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
China’s annual trade surplus has exceeded $1tn for the first time, as the manufacturing powerhouse shrugged off the impact of Donald Trump’s trade war.
New trade data today shows that Chinese factories swelled their sales to non-US markets this year, making up from a sharp drop in shipments to the US.
In November, China’s exports grew 5.9% year-on-year, customs data shows. That reverses a 1.1% contraction in October, and beats analyst forecasts.
And for the first 11 months of the year, China’s annual trade surplus (the difference between what it exported and imported), rose above the $1tn mark for the time (by my maths it was over $1.07tn).
While exports to the US have slowed this year, due to the trade tensions between Washington and Beijing, China has turned to other markets – such as Europe.
Lynn Song, ING’s chief economist for Greater China, explains:
November exports to the US were down -28.6% YoY, a three-month low, bringing the year-to-date growth to -18.9% YoY. It’s likely that November exports have yet to fully reflect the tariff cut, which should feed through in the coming months.
Also, the frontloading effect as US importers ramped up purchases ahead of tariffs will act as a headwind on trade in the coming months. Instead of the US, the beat in November’s data came from an acceleration of exports to the EU.
By product, Song adds, familiar categories continued to see the strongest growth; ships (26.8%), semiconductors (24.7%), and autos (16.7%).
China’s rare earth exports jumped 26.5% month-on-month in November, Reuters reports – that’s the first full month after Xi and Trump agreed to speed up shipment of the critical minerals from the world’s largest refiner.
Soya bean imports are also poised for their best-ever year, as Chinese buyers, who had shunned US purchases for the majority of this year, stepped up purchases from American growers in addition to large purchases from Latin America.
The agenda
Key events
Over in Germany, industrial production rose much more than anticipated last month.
Industrial output increased by 1.8% month-on-month in October, data firm Destatis reported, up from 1.1% in September.
Destatis says:
Within the industrial sector, an increase was recorded across all three main groups: the production of capital goods and consumer goods each rose by 2.1%, and the production of intermediate goods by 0.6%. Outside of the industrial sector, energy production increased by 1.4%.
This pick-up could help Germany’s economy to return to growth in the final quarter of 2025.
China’s yuan-denominated exports to Russia fell for an eighth straight month in November, today’s customs data shows.
Reuters has the details:
Shipments to Russia dropped to 67.71bn yuan (£7.2bn) in November, 5.1% less than the same month last year. Exports plunged 22% in October.
Imports from Russia rose 3.2% on-year, accelerating from October’s 2.5% growth.
Exports to Russia in the January-November period were down 11.2% from the same period last year.
Today’s trade data also shows China’s exports to the European Union grew an annual rate of 14.8% last month.
That could intensify concerns within Europe that China is dumping products in their markets, to avoid tariffs at the US border.
Yesterday, French president Emmanuel Macron said he has threatened China with tariffs if Beijing fails to take steps to reduce its massive trade surplus with the EU.
After returning from a state visit to China, Macron told business daily Les Echos:
I told them that if they don’t react, we Europeans will be forced to take strong measures in the coming months”
Introduction: China’s trade surplus hits $1tn
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
China’s annual trade surplus has exceeded $1tn for the first time, as the manufacturing powerhouse shrugged off the impact of Donald Trump’s trade war.
New trade data today shows that Chinese factories swelled their sales to non-US markets this year, making up from a sharp drop in shipments to the US.
In November, China’s exports grew 5.9% year-on-year, customs data shows. That reverses a 1.1% contraction in October, and beats analyst forecasts.
And for the first 11 months of the year, China’s annual trade surplus (the difference between what it exported and imported), rose above the $1tn mark for the time (by my maths it was over $1.07tn).
While exports to the US have slowed this year, due to the trade tensions between Washington and Beijing, China has turned to other markets – such as Europe.
Lynn Song, ING’s chief economist for Greater China, explains:
November exports to the US were down -28.6% YoY, a three-month low, bringing the year-to-date growth to -18.9% YoY. It’s likely that November exports have yet to fully reflect the tariff cut, which should feed through in the coming months.
Also, the frontloading effect as US importers ramped up purchases ahead of tariffs will act as a headwind on trade in the coming months. Instead of the US, the beat in November’s data came from an acceleration of exports to the EU.
By product, Song adds, familiar categories continued to see the strongest growth; ships (26.8%), semiconductors (24.7%), and autos (16.7%).
China’s rare earth exports jumped 26.5% month-on-month in November, Reuters reports – that’s the first full month after Xi and Trump agreed to speed up shipment of the critical minerals from the world’s largest refiner.
Soya bean imports are also poised for their best-ever year, as Chinese buyers, who had shunned US purchases for the majority of this year, stepped up purchases from American growers in addition to large purchases from Latin America.
The agenda
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