(Yicai Global) Feb. 23 -- As the biggest exporter to the US, China has kept the price of its exports to the North American nation stable, unlike many other countries, and has played a key role in calming US price pressures during the Covid-19 pandemic, according to a recent report.

Since the start of the pandemic, the price of manufactured goods imported into the US have in general risen between 1.5 percent and 3 percent, according to an article released by economists at e-commerce giant JD.com’s technology unit today. Yet the price of those imported from China have remained the same despite a 6.5 percent appreciation of the Chinese yuan against the US dollar last year.

Without the buffer from China’s steady supply, US inflationary pressures would be much more pronounced, JD Technology Chief Economist Shen Jianguang and Senior Researcher Xu Tianchen said.

In the face of a full-blown outbreak of the Covid-19 pandemic from March last year, the US stabilized its economy and supported consumption with unprecedented fiscal stimulus and monetary easing. Retail sales regained growth last June from the previous year. However, the recovery of production was much slower than that of demand, resulting in a significant gap.

Once the epidemic was contained, China’s supply side quickly recovered and was able to step in to fill the gap, the report said. Chinese exports to the US increased by 8.2 percent last year. The monthly growth rate has stayed above 20 percent since August last year and even approached 50 percent in November.

As a result, China quickly regained its position as the largest source of US imports with a 18.6 percent share, surpassing the European Union. It remains significantly ahead of Canada, Mexico, the Association of Southeast Asian Nations and other major US trading partners. This also shows that despite all the measures taken by the Trump administration to hamper trade between the two countries, US dependence on China for its commodity exports has increased, the economists said.

With a vaccination roll-out accelerating economic recovery and President Biden’s decision to introduce USD1.9 trillion in fiscal stimulus, expectations for a US recovery are now turning into concerns about economic overheating and inflation. The inflation expectations in US Treasury Inflation-Protected Securities are close to the highs of the financial crisis in 2008. Without China’s steady supply, US inflationary pressures would be much bigger, they added.

Editor: Kim Taylor