China and the United States have been stuck in a trade feud for 16 months, and no initial deal has been made.
China's trade surplus with the United States in October was $26.42 billion while $25.88 in September. October trade surplus was up a bit based on customs data from Reuters.
In August, China’s exports in U.S. dollars unexpectedly fell by 1% year-over-year, while imports were dropped 5.6% in the same period. That brought its trade surplus to $34.83 billion. China’s exports in September was 0.7% lower from a year ago, while imports dropped 6.2% during the same period. China's exports in October fell 0.9% from a year earlier for the third straight month, and was worse than in September, due to the latest additional levies by the United States on Chinese imports from Sept. 1, blocking the country's outbound shipments, along with stubbornly weak global demand. China's imports shrank 6.4% from a year earlier for the sixth consecutive month.
From the previous three months’ data, we can see China is making efforts in increasing trade surplus by balancing exports and imports.
Imports have been decreased along three months. The weak import figures also match Chinese slow economic growth rate, with shrinking factory activity and bleak producer prices. The domestic demand is weak, and the government policy stimulus is limited.
Whether the extend tariff suspensions on $34 billion of Chinese goods are set to expire on Dec. 28 this year is undecided. But China's state news agency Xinhua reported late on Thursday that the Chinese customs and Ministry of Agriculture were considering removing restrictions on U.S. poultry imports, which showed China tried to make progress to relief the tariff. On Thursday, officials from both sides said Beijing and Washington agreed to roll back tariffs on each other's goods as part of the first phase of a trade deal.
But President Donald Trump on Friday said he has not agreed to rollbacks of U.S. tariffs sought by China, which contradicts with what officials said on the previous day and gives shades to the two largest economies. Trump has used tariffs to gain US government billions of dollars from Chinese export goods as his primary weapon in the protracted trade war, and so the idea of tariff rollbacks was hard to go through consent within the Trump administration.
The so-called “phase one” interim deal can’t be made so easily. If there’s no rollback of tariffs, there will not be a phase one deal.