The month of July 2010 has reported a massive 28 billion US dollars trade surplus, due to sharp drop in imports without any corresponding drop in exports. The export growth has been near the 40% rate while the imports were around the 35% growth rate.
The world’s fastest growing country did not see any major increase in the trade surplus with the western world, and most of the increase in the trade surplus is due to surge in exports to Asian and Middle East countries. The conscious cut in the domestic financial lending by banks in the last few months, has forced many Chinese citizens to cut down on their spendings , and that is what is reflected in the drop in imports.
There could be more pressure now on China from US and Europe for further appreciation of the Yuan against the global currencies.