Chinese exports recorded a strong jump during September, exceeding market expectations by a large margin, an indication of the continued strength of global demand for Chinese technological products, cars and industrial equipment, despite the slowdown in domestic demand and the escalation of trade tensions with the United States and the European Union.
Chinese customs data showed, on Wednesday, that exports rose by 36.3 percent on an annual basis, compared to a growth of 25 percent in August, and exceeding economists’ expectations that indicated an increase of 25.5 percent. This performance represents the fastest pace of export growth since February, when it recorded an increase of 39.6 percent, which strengthens the position of foreign trade as one of the main engines of growth in the second largest economy in the world.
The strength was not limited to exports; Imports rose by 31 percent in September, compared to 28.2 percent in August, exceeding market expectations of 24.5 percent, indicating continued trade activity related to industrial production and supply chains.
These developments led to the expansion of China's trade surplus during September to $133.53 billion, while the accumulated surplus during the first nine months of the year amounted to $938.11 billion. Thus, China is within a short distance of exceeding the level of one trillion dollars before the end of the year, and perhaps earlier than last year, when the surplus crossed this barrier in November, before reaching a record level of $1.189 trillion by the end of 2025.
This performance reflects the continued ability of Chinese factories to meet global demand. Especially in sectors related to advanced technology and the transition towards clean energy, despite the pressures facing the local economy.
Wang Jun, Deputy Head of the Chinese Customs Administration, said that foreign trade will remain exposed to a state of uncertainty as a result of geopolitical conflicts and international developments, but he stressed that there are foundations that support the continued growth of exports and imports during the last quarter of the year.
Analysts believe that demand for technological products will continue to support Chinese trade until the end of 2026, as global investments in artificial intelligence infrastructure continue to expand.
Lin Song, chief economist for Greater China at ING Bank, said that major trade relations appear likely to stabilize until the end of the year, which helps maintain the strength of the most prominent engine of Chinese economic growth.
The yuan stabilized against the dollar following the release of the data, supported by the strong performance of exports, while Chinese stocks fell amid pressure on technology companies.
The semiconductor boom stands out as one of the most important factors behind exceptional business performance. The value of China's semiconductor exports rose by 108.1 percent during the first nine months of the year, compared to the same period in 2025, benefiting from accelerating global demand for electronic components used in artificial intelligence applications and data centers. This growth reflects the increasing role of technology industries in China's export structure, as companies expand the production of advanced components that go into digital industries.
The automotive industry also continued to strengthen its global presence; Car exports rose by more than 50 percent, both in value and volume, during the first nine months of the year. This confirms that China no longer relies solely on exports of traditional consumer goods; Rather, technological products and cars have become among the most prominent sources of its commercial expansion.
However, this export power carries increasing challenges. Especially with the expansion of trade surpluses with major partners. China's trade surplus with the United States reached $34.01 billion in September, the highest level in 20 months, while the surplus with the European Union reached $34.8 billion. The continuation of these high levels would enhance the political and trade pressures on Beijing, in light of American and European accusations of Chinese industrial and monetary policies of contributing to the trade imbalance.
During their summit in Washington last month, Chinese President Xi Jinping and his American counterpart, Donald Trump, reached an extension of the customs truce and an agreement to reduce duties imposed on goods exchanged worth $30 billion from each side. Although the agreement helped calm some tensions, a continued rise in the trade surplus may revive disputes over industrial competition and market access.
In Europe, Brussels and Beijing announced this month an agreement to limit Chinese hybrid car exports to the European Union, in a move aimed at regulating the increasing flows of Chinese vehicles. It is expected that detailed procedures will begin to be determined during December, which may prompt some Chinese companies to accelerate their shipments before the new restrictions take effect.
Nguyen Hoang Nam, China economist at Capital Economics, said that the widening trade surplus with Europe may encourage the European Union to impose broader restrictions beyond the recent agreement on cars, but he expected that the overall economic repercussions on China would be limited. These developments reveal a complex equation facing the Chinese economy. The stronger exports become, the greater their contribution to supporting growth, but at the same time they increase the possibility of companies being exposed to new trade restrictions.
This dilemma is particularly important in light of the continued weakness of internal demand and the real estate sector crisis that has been going on for years. Separate data showed that producer prices in China rose during September at the fastest pace in more than 4 years, driven by an increase in oil and basic commodity prices, while consumer price inflation fell below market expectations. This discrepancy reflects the continued weakness of domestic demand, despite the improvement in some industrial and commercial indicators.
In the commodity market, China's crude oil imports fell by 21.5 percent in volume during September compared to the previous year, while soybean imports fell by 7.7 percent. These figures indicate that overall strength in imports does not necessarily mean equal improvement in all sectors; Demand trends vary according to the nature of goods and their prices.
The Canton Fair, the largest trade fair in China, is expected to start on Thursday. Manufacturers offer their products to foreign buyers, in a new test of global demand during the last quarter. At the level of economic policies, the strength of exports gives the Chinese authorities greater scope to be satisfied with moderate support measures to achieve the annual growth target, set between 4.5 and 5 percent. However, this margin remains linked to the continued external demand and the absence of broad trade restrictions on Chinese products.
Last week, the People's Bank of China defended its exchange rate policy, stressing that it does not seek to competitively devalue the yuan, and rejecting accusations that the authorities are deliberately keeping the currency weak to boost exports. These statements come at a time when trading partners are increasingly sensitive to the size of the Chinese surplus, and what they see as the impact of government policies on the competitiveness of companies. For investors, the September data points to continued opportunities in technology, semiconductor and automotive sectors, but also highlights risks from trade tensions and the possibility of new restrictions on exports.
The increasing dependence on external demand also makes the economy more vulnerable to any global slowdown or change in the policies of trading partners. If exports continue at the current pace, China is likely to exceed $1 trillion in trade surplus before the end of the year, which could put it on track to record a new record surplus.
However, the biggest challenge facing Beijing will not be achieving an additional record in foreign trade; Rather, it is to transform the strength of the export sector into more balanced economic growth, by stimulating local consumption, addressing the real estate crisis, and enhancing private investment. While the technology and automobile boom is giving the Chinese economy a strong boost, the sustainability of this momentum will depend on Beijing’s ability to manage its trade relations with the United States and Europe, and reduce growth’s dependence on foreign markets, in light of a global economic environment characterized by increasing restrictions and competition.
Futures for the Standard & Poor's 500 and Dow Jones indexes rose slightly on Wednesday, with shares of companies related to artificial intelligence stabilizing after a recent decline, while high oil prices kept investors in a state of anticipation ahead of the release of key inflation data and the announcement of a new set of bank results.
After mixed results for American banks the previous day, Bank of America, Morgan Stanley, BlackRock, and State Street are scheduled to announce their results before the markets open, according to Reuters.
Bank of America shares fell by 1.5 percent in pre-opening trading, after the bank revealed a regulatory fine worth $1.21 billion, which may affect its results during the third quarter. In contrast, Morgan Stanley shares rose by 0.7 percent.
The performance of shares of electronic chip companies varied, following a sharp decline earlier in the week, after reports of Chinese company CXMT making progress in designing chips raised fears of intensifying competition.
Intel and Micron shares fell by 1.1 percent and 1.3 percent, respectively, while Nvidia shares rose by 0.2 percent.
Shares of the seven major companies known as the “Great Seven” also rose, as “Alphabet” shares rose by 0.7 percent, while “Meta” and “Amazon” shares recorded slight gains.
By 5:41 a.m. EST, Dow Jones futures rose 234 points, or 0.45 percent, and Standard & Poor's 500 futures rose 16.25 points, or 0.21 percent. On the other hand, Nasdaq 100 futures fell by 9 points, or 0.03 percent.
Investors were also awaiting the US Consumer Price Index data, searching for indications about the next path of the Federal Reserve's interest rates. Economists polled by Reuters expected general inflation to accelerate to 3.6 percent on an annual basis in September, with the core inflation index, which excludes food and energy, rising by 0.2 percent on a monthly basis.
New York Fed President John Williams said the central bank may need to raise its key interest rate again this year to curb inflation, but he does not see a need for increases in 2027.
Statements by the President of the Federal Reserve Bank in Richmond, Tom Barkin, are also scheduled to be issued, in addition to the “Beige Book” report issued by the Federal Reserve, which reviews the economic conditions in the various American regions, later in the day.
Prior to the release of inflation data, the CME Group's Fed Watch tool showed that investors were pricing in a probability of approximately 22 percent to raise US interest rates by a quarter of a percentage point next week.
Oil prices rose slightly, with Brent crude remaining above $100 a barrel, after two ships were attacked in the Strait of Hormuz, while Iranian officials told Reuters that Tehran is adopting new tactics to target ships.
In individual stock movements, Licodia shares jumped by 49.9 percent, after the pharmaceutical company announced the settlement of six pending lawsuits with United Therapeutics, ensuring the continued availability of the drug “Eutribia,” used to treat patients with a form of pulmonary hypertension.
