The service trade deficit stood at $15.4 billion in January, up from $11 billion a month earlier, according to the State Administration of Foreign Exchange (SAFE).
Tourism contributed $14.5 billion of the deficit last month, compared with $12.5 billion in December.
Chinese people have started to make outbound trips for the first time in three years after Beijing reopened its borders in early January.
Lemon Zhang, FX strategist at Barclays, said consumption by Chinese tourists outside the country accounted for up to 85% of the service deficit before the COVID-19 pandemic.
“A lower current account surplus due to weaker exports, the resumption of international tourism and likely rising domestic capital outflows poses headwinds,” Zhang said, noting the looming downside pressure on the Chinese currency.
The yuan ended the domestic session at 6.9442 per dollar on Friday and gave up all the gains it has booked so far this year. [CNY/]
In 2022, China posted a total service trade deficit of $98.9 billion.
(Reporting by Winni Zhou and Brenda Goh; editing by Jason Neely and Kim Coghill)
Source: market screener
