09/04/2010: Daily Economic Headlines, All eyes on China

China may post its first trade deficit in six years as imports surge.

  • China’s imports of commodities and consumer goods has surged as imports would probably exceed exports by $390million in March after a $7.6 billion trade surplus the previous month.
  • U.S. Treasury Secretary Timothy F. Geithner met in Beijing yesterday with Chinese Vice Premier Wang Qishan for action to rein in a U.S. trade gap with China ($227 billion last year).
  • Premier Web Jiabao’s government stated that a stable yuan and its 4 trillion yuan ($586 billion) fiscal stimulus has contributed to global recovery.

China’s barriers may undercut effect of Yuan change.

  • China’s discrimination against foreign goods bad barriers to imports may undercut any gain of American exports from the yuan’s revaluation.
  • American companies are said to be harmed by Chinese policies to restrict government purchases to software and clean-energy products.
  • China’s trade surplus with the U.S. rose to $226.8 billion last year and is more than the combined deficit the U.S. has with its next nine biggest trading partners.
  • Many American senators blame China’s 21-month peg of its currency, the yuan, to the dollar for the trade imbalance that the U.S. is currently facing.

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