Despite Trump efforts, U.S. trade deficit with China hits record

China is hitting the US where it hurts soybeans

Beijing said China's surplus with the USA hit an all-time high $28.97 billion last month, while exports to the country hit a record $42.62 billion.

Thus far, China has imposed retaliatory tariffs on $34 billion-worth of US imports, targeting politically sensitive goods such as soybeans. "They are just a trade bully", he told reporters in Geneva.

Asked if China was breaking WTO rules by imposing retaliatory tariffs on USA goods without first launching a formal legal dispute, Wang said China could not wait years for a ruling on the U.S. move and had acted "in line with the spirit of worldwide law".

The difference between China's exports to the United States and its imports from the world's largest economy expanded to a monthly high of $29bn (£22bn), up from $24.6bn in May.

After a strong start to the year, growth in China's exports has moderated recently, and is expected to face more pressure from the initial round of USA tariffs.

Separate customs data on Friday showed imports of commodities from soybeans to crude oil eased compared with a year ago, but China's steel mills and aluminium smelters sold much more overseas spurred by higher global prices amid growing concerns about slowing demand growth.

Earlier on Thursday, President Donald Trump said the United States was in a nasty trade battle with China, but things would ultimately work out.

Analysts expect shipments growth to slow in the second half of the year, putting more strain on an economy already feeling the pinch from a multi-year debt battle that has driven up corporate borrowing costs.

But comments from China's commerce ministry indicated that June's figures are a blip, a result of Chinese companies pushing to get products out the door before the tariffs went into effect, according to Reuters. They said as a outcome figures for July and August were likely to show a decline in exports to the US.

In yuan terms, China's exports grew 3.1% in June and imports rose 6.0%.

In a sign Beijing is seeking alternative supplies of the commodities as it hit US imports with extra tariffs, China had dropped import tariffs on a range of animal feed ingredients from several Asian countries.

Speaking after a regular two-yearly review of China's trade policies at the World Trade Organization (WTO), Wang was sceptical.

The surplus was the highest ever with the USA for any single month, according to Reuters calculations based on official data going back to 2008. China retaliated with higher duties on a similar amount of American goods.

Others say the latest data shows how hard it will be for the United States to win the trade war, arguing that Americans want to buy Chinese-made products.

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