FILE PHOTO - A woman walks past containers at a port in Shanghai. Photo: Reuters / Aly Song

Exports from China increased by 11.3% YOY in June, while imports expanded by 17.2%, both numbers beating analyst expectations.

Reuters reports that the increase in China’s trade surplus, which grew to US$42.77 billion from US$40.81 billion, was slightly above analyst forecasts. In contrast, MarketWatch reported the surplus came in well under the median forecast they cited of US$44.2. A widening gap with the US could increase trade tensions between China and the Trump admininstration.

“Looking ahead, we expect export growth to slow on uncertainties in external demand due to rising geopolitical risks and the stronger yuan-U.S. dollar exchange rate in the first half of 2017,” Nomura researchers were quoted by  in a note after the data release.

“Exports should continue to do well given the relatively positive outlook for China’s main trading partners,” Julian Evans-Pritchard, China Economist at Capital Economics, said in a note.

“But we are skeptical that the current pace of imports can be sustained for much longer given the increasing headwinds to China’s economy from policy tightening.”