The reflation trade is back on. We are seeing more optimism about the global economy.

The trade surplus figures showed strong exports and domestic demand. This shows the economy is robust enough to withstand a rate increase later this year, supporting the yen.

The latest trade figures confirm that Japan's economy is recovering steadily and modestly.

Recognizing the many uncertainties about the broader economy, we are carefully walking the line between realism and optimism, ... Although it appears that our revenue stream will improve as the year plays out, the pace and timing of recovery is uncertain.

It suggests the drag on the economy from the trade deficit in the third quarter will not be as great and could help revise up third-quarter GDP a bit,

The strong domestic economy should cushion the impact of an anticipated slowdown in Hong Kong's trade growth this year.