China's foreign trade in March firmed beyond market expectations, reflec­ting improving external and domestic demand.

Exports in yuan-denominated terms rose 22.3 percent year on year in March to 1.24 trillion yuan (US$180 billion), while imports surged 26.3 percent to 1.07 trillion yuan, the General Administration of Customs said yesterday.

The figures compared with a 11 percent increase in exports and 34.2 percent growth in imports in the first two months of this year.

In US dollar terms, exports jumped 16.4 percent and imports rose 20.3 percent, higher than market estimates of 3.2 percent and 18 percent respectively according to a Reuters poll.

Analysts said the better-than-expected trade data suggested a stronger global economy and continued improving domestic demand.

“March export growth accelerated, import growth moderated less than expected,” Morgan Stanley said in a note yesterday. “The better export readings confirmed improving external demand. Meanwhile, growth in imports were better than expected, as the drag from a high base was partly offset by higher import prices, stronger processing trade and a still resilient domestic demand.”

The strong export growth provided room for the central bank to continue raising interbank rates and imposing tighter rules on non-standard credit to slow the pace of broad credit growth, the note said.

But Huang Songping, a customs spokesman, cautioned yesterday that pressure remains for the year as the global economic recovery is uncertain while the prices of commodities remain volatile. He added that a high base in the second quarter last year may result in slower headline growth of trade in the next three months.

Earlier economic indicators such as the Consumer Price Index and Producer Price Index for March also showed stability in the Chinese economy, according to the National Bureau of Statistics.