The headline number is not that great. Aside from beating market expectations for ¥575.8 billion surplus, Japan's trade balance showed that the surplus decreased to ¥614.7 billion in March from ¥813.4 billion in the previous month and 17.4% less than March 2016's surplus of ¥744.9 billion.

This is because Japan bought more than it sold over the past 12 months to March. Exports grew by 12.0% while imports jumped by 15.8%.

And that is the good news. Japanese exports have been on an uptrend since the 14.0% drop recorded back in July last year, supported by the weaker yen and the general improvement in Japan's trading partners.

The better news is the 15.8% jump in imports. Although this would provide a negative contribution to GDP growth, it also indicates strengthening domestic demand.

Similar to the trend in exports, the year-on-year growth in Japanese purchases from overseas had been gaining since the 24.7% drop in July 2016. The details are even more encouraging as purchases increased strongly for all imported products: mineral fuels (36.3%); raw materials (15.3%); chemicals (13.8%); manufactured goods (12.9%); foodstuff (12.6%); electrical machinery (10.6%); transport equipment (9.5%); others (9.2%).

Like the Eurozone, growth is gaining momentum in Japan. But similar to the Eurozone inflation remains low - headline CPI inflation was at 0.3% in the year to February; core CPI at 0.2%.

Read more: JapanCPIGDPEurozoneSunrise
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