American businesses sharply increased orders for Chinese goods in the weeks before the high-stakes summit between President Donald Trump and Chinese leader Xi Jinping.
The jump came as a “surprise,” according to China Beige Book, a New York-based research firm that surveyed 1,295 Chinese companies between September 1 and 22.
Shipments to the U.S. rose on both a yearly and monthly basis “as China’s relative tariff position improved,” the research firm noted in its findings.
The gauge measuring U.S. orders jumped to 13 in September, up sharply from negative-12 a year earlier and 3 in August, signaling a notable reversal in momentum.
Despite the surge in U.S.-bound orders, overall Chinese domestic and export orders remained below their levels from a year earlier, and new orders weakened from August.
Xi Jinping is in Washington this week for his first state visit in more than a decade, meeting Trump as trade tensions between the two countries remain elevated.
The two countries agreed to extend by two months to January a trade truce that keeps tariffs lower, suspends restrictive controls on rare earth exports, and holds off higher port fees on ships.
The U.S. also reportedly planned to delay a threatened round of tariffs tied to industrial overcapacity until at least after this week’s summit, easing near-term pressure on Chinese exporters.
The effective U.S. tariff rate on Chinese goods remains around 23%, which is well above the average levy the U.S. imposes on other major trading partners, according to Barclays.
China’s ports saw their busiest week on record in the run-up to the summit, aligning with the export order figures and signaling recovering trade flows amid hopes for a bilateral thaw.
Following the truce extension, Eurasia Group raised its odds of continued stability in the U.S.-China bilateral relationship to the highest level since Trump returned to office.
“Neither government has an interest in renewed escalation,” said Dan Wang, China director at Eurasia Group, who expects both sides to press each other for near-term commitments to maintain the fragile stability.
Washington is likely to seek further progress on expedited Chinese approval of rare-earth export licenses for U.S. end users, as well as increased purchases of U.S. agricultural goods, Wang said.
In return, Beijing would expect the White House to maintain its current pause on arms sales to Taiwan, according to Wang’s assessment of the likely negotiating dynamics.
The two leaders are expected to meet again at the APEC summit in Shenzhen in November, and potentially on the sidelines of the G20 summit the U.S. is hosting in Miami in December.
