China's trade surplus is rising, excluding gold imports, challenging claims of a peak, according to the Council on Foreign Relations report.
Analysts at the Council on Foreign Relations argue that China's trade surplus continues to grow once gold imports are excluded, countering claims it has peaked, reported the Council in a recent report.
London's Economist recently suggested China's surplus had topped out, but CFR fellow Brad Setser stated that net exports contributed positively to growth in the first two quarters of 2026. He noted that chip and oil imports were not the decisive factors; rather, a surge in gold imports worth US$146 billion year-to-date, nearly $100 billion above the 2025 total, played a significant role.
In Q2 alone, gold imports equaled 1.5 percentage points of GDP. Without them, the goods surplus would have risen by more than $80 billion in the first half of 2026, equivalent to nearly 7 percent of GDP.
Setser mentioned that auto exports are booming while imports remain flat, and the rise in chip prices inflated both imports and exports. He argued that China's statistical authorities were slow to capture the impact of higher memory chip prices, distorting Q1 data and overstating Q2 imports.
The analysis concluded that China's underlying manufacturing surplus, excluding chips and gold, is still climbing. Setser added that the US deficit is expanding due to AI-related investment and fiscal spending, underscoring how both economies remain heavily reliant on trade flows.
