US Chip Embargo Has Started Taking Toll On China, Data Suggests

China’s purchases of machines to make computer chips fell 27% last month from a year earlier as the U.S. kicked off new, sweeping sanctions to try to derail the country’s chip ambitions, Bloomberg reports.
Chinese firms imported $2.4 billion worth of machinery used in semiconductor manufacturing in October, the lowest amount in more than two years after Washington broadened restrictions on selling the gear to the leading economy and importer of semiconductors.
October was significantly weaker by value than any other month this year.
Also Read: Trouble Brews For Chinese Chipmakers As US Senators Propose Harsher Measures
Chinese purchases from overseas suppliers have fallen in seven of the ten months that data has been reported in 2022.
Purchases from major exporters such as Japan and the U.S. were down in October. Shipments from the Netherlands doubled in the month. That is where ASML Holding N.V. ASML, the leading producer of chip-making equipment, is headquartered.
The U.S. negotiated with Japan and the Netherlands to try and convince them to limit what could be sold to Chinese firms.
The trade data also showed that Chinese imports of computer chips were up 1% in the first ten months of the year. However, much of that growth came at the start of 2022.
More recent declines have reflected a cratering demand for smartphones and PCs after fears of a global recession deepened.
It may also be problematic for China to try and ramp up purchases of these goods from non-US suppliers anytime soon.
Price Action: ASML shares are down by 0.20% at $595 premarket on the last check Wednesday.
Photo: Body Stock and Dragon Claws by Shutterstock

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