Goldman Sees Larger China Current Account Surplus In 2026

Goldman Sachs Group Inc. has raised its projection for China’s current-account surplus in 2026, reflecting stronger trade performance in the last quarter.

The U.S. bank now expects China’s difference between exports and imports of goods and services to widen further than previously anticipated this year.

What’s The Revised Forecast?

Goldman’s economists have raised their estimate of China’s current-account surplus in 2026 to about 4.3% of Gross Domestic Product (GDP), up from their prior forecast of 4.1%.

This revision comes after new data showed that the current-account surplus strengthened to 3.7% of GDP in 2025, exceeding the bank's expectations of 3.5%.

Why Is Goldman Expecting A Bigger Surplus in 2026?

Goldman’s economists said the surplus is likely to expand further in 2026, mainly due to expectations of a wider goods trade surplus and a slightly smaller services trade deficit.

They added that capital and financial flows are expected to remain broadly stable. The bank expects inbound and outbound Foreign Direct Investment (FDI) to remain similar to last year, while portfolio outflows may ease.

What Did SAFE Data Reveal About China’s Latest Surplus?

Early numbers published by the State Authority of Foreign Exchange (SAFE) in China recorded that the nation had realised a current account surplus of $242 billion in the fourth quarter of 2025.

This surplus, according to Goldman Sachs, translates to approximately 4.4 per cent of the GDP of China, showing that the external position of China has been greatly strengthened within the quarter.

The information provided by SAFE indicated that the services trade deficit in China had lessened in the fourth quarter compared to what it was in the earlier quarter, and this helped to enhance the balance of the current account.

Simultaneously, the goods trade surplus in China grew significantly, with the help of an increase in exports, which became a major force behind the stronger external figures. This amount of a greater surplus, coupled with the rising services balance, reinforced the overall external position of China into 2026.

How Does Goldman’s View Compare With The IMF's?

The International Monetary Fund (IMF) had projected China’s overall current account surplus at 3.3% of GDP last year.

However, the latest figures and Goldman’s estimates suggest China’s external surplus may be significantly higher than that projection.

The IMF has also flagged that China’s external imbalances are becoming more visible, linking part of the widening surplus to a real depreciation of the yuan.

What Could It Mean For Indian Markets?

For Indian markets, a stronger Chinese current account surplus could have mixed implications. If China’s export momentum remains strong, it may increase competitive pressure on global manufacturing and export-driven sectors, including Indian exporters in certain categories.

Simultaneously, the increased surplus tends to reflect an impressive demand in industrial production that might affect the world commodity prices, especially metals, affecting Indian industries in terms of infrastructure, auto, and capital goods.

Also, any international attention to yuan depreciation or increasing trade imbalances may impact global currency sentiment more generally, such as the rupee, and may also affect foreign investor positioning in Asian equity markets.

What Does This Mean For Investors?

To investors, the improved surplus projection by Goldman is an indication that the external position of China is stable, with much of the support coming through the momentum in exports and the better balances in trade. Increased current account surplus normally enhances the stability of foreign exchange and may diminish the near-term foreign debt strain.

At the same time, the growing imbalance may increase global scrutiny on China’s trade strength and currency dynamics, especially as the IMF has connected widening imbalances partly to yuan depreciation.

Investors should also monitor whether stronger goods exports continue into 2026 and whether capital outflows ease as Goldman expects, as these factors will shape currency movement, trade-linked sectors, and broader emerging market sentiment.

Sources:

Bloomberg

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