Week In FX Asia - China Displaces U.S. From Top Trading Nation Spot

 |  Includes: CYB, FXA, FXY, INR, UDN, UUP
by: Dean Popplewell

By Alfonso Esparza

China reported today its final trade numbers for 2013. For the first time it has broken the $4 trillion mark. Total Chinese trade came in at $4.2 trillion in 2013. The US has not published it trade numbers for December, but that leaves the 11 month data available at $3.5 trillion for US trade guaranteeing China the top spot as there is no expectation of a surprise catch up.

The final month of the year marked a slowdown in Chinese trade, but not enough to derail the pace set in the previous months that made China reach the top spot. Even though Chinese trade grew overall it is interesting to note its relationship with Japan.

China to Japan trade actually decreased more than 5 percent in 2013. In 2012 the decline was 3.9 percent and was directly attributed to the bilateral dispute for the Senkaku Islands. The row sparked boycotts in 2012 and the animosity continued well into 2013 when China set new Air Space configurations that included the islands. Shinzo Abe did not help matters by visiting the Yasukuni War shrine. The visit is seen by China and South Korea as an insult at it glorifies people who are considered war criminals in those countries.