US President Donald Trump started announcing new tariffs on imports in January as part of an attempt to negotiate what he called "fair, bilateral trade deals that bring jobs and industry back onto American shores".
Thanks to the surge, the trade surplus narrowed by 42.6 percent to 176.96 billion yuan last month.
The dispute has continued to escalate as the sides exchange threats, and Trump last week threatened to jack up the tariff rate on the next $200 billion in Chinese imports it plans to target to 25 percent, from the planned 10 percent. China responded by promising to hit $60 billion worth of USA goods coming into the country with tariffs.
U.S Customs will begin collecting duties on 279 product lines ranging from motorcycles to steam turbines and railway cars, the US Trade Representative's Office said in an emailed statement on Tuesday. For instance, the major complaint is about the theft of U.S. intellectual property by Chinese firms.
China's crude oil imports in July rose for the first time in three months, but were still at their third lowest monthly level so far this year, as independent refiners continue to suffer from the new tax regime eroding their refining margins.
"Looking ahead, we expect export growth to cool in the coming months, though this will primarily reflect softer global growth rather than U.S. tariffs, the direct impact of which will continue to be mostly offset by the renminbi's (yuan's) recent depreciation", Capital Economics' Senior China Economist Julian Evans-Pritchard wrote in a note. Should the USA proceed with those tariffs, China's ready to slap duties on an additional $60 billion of American goods.
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Economists had forecast the surplus would be $39.33 billion in July, compared to a surplus of $41.47 billion in June.
USA president Donald Trump has threatened to target all $500bn of Chinese imports.
Washington imposed 25% duties on $34bn (£26.3bn) of Chinese goods on 6 July in response to those complaints.
While short-term effects might be mild, the impact of US tariffs on China's trade may be gradually revealed as time passes and more tariffs on Chinese goods threatened by the United States take effect, it noted.
Economists warn that a prolonged trade war between China and the USA could end up increasing prices for American consumers and hurting United States businesses.