China’s trade surplus tops $1 trillion for second year

China's trade surplus passed $1 trillion in the first 10 months of 2026, helped by global spending on artificial intelligence infrastructure. The rising imbalance could add to friction with trading partners just before a summit between Chinese President Xi Jinping and U.S. President Donald Trump. Exports rose 35.2% in October from a year earlier in dollar terms, according to customs data released Tuesday in Beijing, Reuters Thomson Reuters Corporation ↗ 0.10% reported. That was slightly slower than September's 36.3% gain but beat the 33.5% economists had forecast. Imports grew 41.6%, well above the expected 32% and up from 31% in September, CNBC Comcast Corporation ↗ 0.98% reported.reuters.com+1

The surplus for January through October reached $1.04 trillion. It is the second straight year above $1 trillion, and China crossed the mark a month earlier than in 2025, Reuters reported. The Associated Press said China is on track to beat last year's record surplus of $1.2 trillion, The Washington Post reported.washingtonpost.com+1

Monthly gap narrows

Because imports rose so quickly, October's surplus fell to $105.3 billion from $133.5 billion in September. According to the South China Morning Post Alibaba Group Holding Limited ↘ 2.52%, exports totaled $412.3 billion and imports $307 billion, and the 10-month surplus was more than 8% higher than a year earlier. Investing.com said a stronger yuan helped shrink the monthly figure, which came in below the $126.5 billion analysts expected, Yahoo Finance reported.finance.yahoo.com+1

Exports this year have been led by high-tech goods such as semiconductors, along with autos, The Washington Post reported. "The outlook for exports depends on how long the AI boom will last," analysts at Macquarie wrote. They expect exports to speed up in the fourth quarter and then slow from early 2027, Reuters reported.reuters.com+1

Summit and trade tensions

The data comes ahead of next week's Asia-Pacific Economic Cooperation summit in Shenzhen, where Xi and Trump are expected to meet for the third time this year. China's surplus with the U.S. edged down to $32.71 billion in October from $34.01 billion in September. On Monday, Beijing extended its trade truce with Washington by two months; the truce had been due to expire on November 10. After a September meeting in Washington, the two sides proposed a $60 billion package of reciprocal tariff cuts, Reuters reported.reuters.com

The European Union is another source of pressure. EU leaders have called for more trade curbs on China, even after reaching a deal with Beijing to limit Chinese hybrid vehicle exports. At home, weak consumer spending and a long property slump have made China's economy more dependent on foreign demand. "The risk of additional tariffs and other trade barriers will remain elevated in 2027, particularly as Chinese manufacturers continue expanding their presence in overseas markets," said Joe Peissel of Trivium China, according to Reuters.reuters.com