China to help stabilize global supply chain

China will play a key role in underpinning the global supply chain in the second half of the year amid government policy measures to stabilize the economy while tackling the impact of COVID-19 via targeted means, experts said.

Although major economies such as Germany, France, South Korea and the United States saw trade deficits in recent months, the surplus of China's foreign trade topped 2.48 trillion yuan ($367 billion) in the first half, as exports soared after the COVID-19 resurgences were brought under control in the Yangtze River Delta region in May and June, data from the General Administration of Customs showed.

As China's trade surplus rose significantly to $97.94 billion in June from $78.76 billion in May, experts said the growth has helped buffer the yuan's exchange rate with other major currencies and further stabilize the domestic inflation rate, reducing the need to raise interest rates or intervene on the currency exchange rate.

As the US Federal Reserve raised key interest rates steeply to curb runaway inflation in the second quarter, the euro, the pound and the Japanese yen all plunged against the US dollar. The currency depreciation in these major economies has brought stagflation and downside risks, said Xu Hongcai, deputy director of the China Association of Policy Science's economic policy committee.