China swung back to a $US5.35 billion trade surplus in March from February's deficit of $US31.48 billion

The outcome confounded economists and analysts, especially those in the US who had forecast a deficit of $US3.15 billion (according to a Bloomberg survey).

In fact a sharp rise in export to the US of nearly 30% helped drive the turnaround, a reflection of the strength of the turnaround in the American economy.

Exports rose 8.9% to $US165.66 billion in March, while imports rose 5.3% to $US160.31 billion.

The value of China's foreign trade in March rose 7.1% year-on-year to reach $US325.97 billion.

For the first quarter, China's imports and exports grew 7.3% from a year ago to reach 8$US59.37 billion.

The country ran a $US670-million dollar trade surplus in the first quarter, a big improvement on the deficit of $US4.15 billion for the first two months of the year and forecasts from economists in China and offshore for a deficit of around $US1.3 billion.

That was after a $US27.28 billion surplus for January.

In fact China had a trade surplus in the first quarter if this year against a deficit in the first quarter of 2011.

That indicates a positive contribution to GDP growth which will be released on Friday.

Reuters says the consensus forecast for first quarter growth is around 8.3%, but the ANZ Bank in Beijing said yesterday that the trade figures has seen it revise its forecast to an annual rate of 8.6%.

Import growth in March of 5.3% (from the same month in 2011) was sharply down from the 39.6% surge in February that drove the surprise deficit for that month and saw many economists warn the country's economy was tanking.

Far from it, as much of the sharp rise in February's imports seems to have been restocking after the Lunar New Year halt for a week or more in late January.

Still, exports grew a sedate 8.9%, half the 18.4% improvement in February from February in 2011.

China's trade surplus with the 27-nation European Union, its biggest trading partner, fell 15% to $US8.1 billion, reflecting the EU's continuing weak level of demand.

But the politically difficult trade surplus with the United States jumped 28% to $US16.6 billion, as the American economy's rebound sucked in more imports.

We saw that with the Japanese trade surplus for February which showed a big rise in shipments to the US and a fall in exports to China.

Exports to the US jumped 11.9% in February from the same month in 2011, the biggest rise since December 2010.

Chinese imports of crude oil, soybeans and other basic commodities rose in a sign of continued consumer demand.

But purchases of metals and other industrial materials fell after high levels of imports of iron ore, copper and other metal in January and February.

The Bank of Japan meanwhile left its monetary policy on hold yesterday, a move that was completely expected by the market.

The central bank said that overseas economies were still slowing, but that Europe has stopped deteriorating and financial markets were generally stable.

In Japan, economic activity showed some signs of picking up but remained "more or less flat" the central bank said.

But some analysts in Tokyo said that with the yen rising to new month highs this week, the chances of another round of easing from the central bank at its April 27 meeting have risen.

The rise in the value of the yen has knocked Tokyo share prices lower in the past six days of trading.

And Japanese corporate bankruptcies fell in the year to March for a third year in a row, according to data released in Tokyo yesterday.

Private credit research company Teikoku Databank says a just over 11,400 companies collapsed, a fall of 0.5% from fiscal 2011.

In northeastern Japan, the number of bankruptcies fell by 27%, helped by government assistances for companies affected by the disaster.

But, the research firm says the situation may be worse in northeastern coastal regions devastated by tsunami and the Fukushima nuclear accidents.

It says about 1,500 companies in the region have stopped operations but have not filed for bankruptcy, or their owners cannot be contacted.

The firm warns that the stronger yen and rising oil prices could boost bankruptcies in coming months.

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