China's trade surplus set a record in July for the third month in a row, the government said on Thursday, underscoring growing concerns among policy makers about China's economic imbalances.
The customs administration said the surplus rose to $14.6 billion from $10.4 billion in July 2005.
Economists polled by Reuters had expected the surplus to be unchanged from June's $14.5 billion.
Cheng Manjiang, an economist with Bank of China International in Beijing, said the surplus may peak this quarter, especially if the government makes good on promised policies to slow exports and boost import growth.
At this moment the trade surplus is already quite high, so I don't expect the monthly figure to continue to surge in the second half of this year, she said.
July exports rose 22.6 percent from a year earlier to $80.34 billion, while imports rose 19.7 percent to $65.72 billion, according to the agency's Web site (www.customs.gov.cn).
For the first seven months, the surplus came to $76.0 billion, about 52 percent more than the total of $50.1 billion in the same period of 2005. The surplus tripled in all of 2005 to $102 billion.
The figures came out a day after the central bank said China needed to rely less on exports as a driver of growth and that the yuan's exchange rate should be part of a package of measures to rebalance the economy.
Premier Wen Jiabao also highlighted China's growing external imbalances in a speech in late July.
The authorities now appear to recognise more explicitly that external imbalances are part of the problem and therefore the yuan exchange rate has to be part of the solution, Qing Wang of Bank of America in Hong Kong said in a note to clients.
The central bank set the yuan's midpoint on Thursday at 7.9688 per dollar, up quite sharply from 7.9772 at Wednesday's close.
The central bank has let the yuan rise just 1.77 percent since depegging it from the dollar in July 2005, but many economists expect the pace of the currency's climb to quicken in coming months.
The yuan's rise is inevitable, but actually the debate is about the range of the rise. The trend is quite clear, Cheng at BOCI said.