In terms of value, China's exports have now reached its highest value this year. This shows that external demand is rising after China's government made a number of policy changes. For example, the government lowered tax for smaller Chinese companies. Consumer confidence in China was also reported to have grown. The government expects the country to meet its 7.5 percent-target in 2013.

China's currency has appreciated about 3.6 percent against the US dollar during the last 12 months, which is in stark contrast with the performance of Japan's yen (21 percent decline). However, during the last three months, China's currency only rose 0.3 percent. As a rising Chinese currency is a burden for the country's exporters, there is a link visible in higher exports and stable currency (against the US dollar) in the last couple of months.

Trade minister Gao Hucheng said that China's exports and imports are expected to rise in the months ahead due to a recovering global market.

Positive economic data from China in combination with a 3.8 percent growth rate of Japan’s economy in the second quarter from the previous period, pushed global stock indices up yesterday (09/09), particularly in Asia and on Wall Street.

Being two major trading partners of Indonesia, expanding economies in China and Japan have a positive effect on Indonesia. Yesterday, Indonesia’s rupiah forwards advanced most in the last three years due to better-than-expected data from China and Japan as it is expected to boost Indonesia's exports and thus narrows the country’s trade deficit, which has been a major concern of investors. 

Discuss