China March data seen showing solid growth but all eyes on

 Trump-Xi meeting Trump has foreshadowed the risk of talks being tense, tweeting on Thursday that the United States could no longer tolerate massive trade deficits and job losses. A flurry of data in coming weeks is expected to show China posted solid economic growth in March, as President Xi Jinping and President Donald Trump meet for the first time this week with China's trade surplus expected to be high on the agenda. Trump has foreshadowed the risk of talks being tense, tweeting on Thursday that the United States could no longer tolerate massive trade deficits and job losses. While Trump has not followed through yet on campaign threats to label China a currency manipulator or impose punitive tariffs on Chinese goods, many analysts reckon the new administration is just beginning to flex its trade muscles. 

China's import growth for March is likely to remain strong, while exports could rebound modestly, according to Reuters polls, producing an expected trade surplus of $10 billion after a rare deficit in February. Exports were expected to rise 3.2 percent, while imports were seen up 18 percent, led once again by raw materials such as iron ore which are feeding a months-long construction boom. Imports had surged 38 percent in February while exports unexpectedly dipped, but China's data in the first two months of the year can be heavily skewed by the timing of the Lunar New Year holidays, when many businesses shut for a week or more. Reflecting continued strength in the manufacturing sector, and particularly heavy industry, China's producer price index (PPI) likely rose 7.6 percent from a year earlier, after jumping 7.8 percent in February, its fastest pace in nearly nine years. However, while factory surveys show manufacturers have been able to pass on some higher input costs by raising prices of their goods, there has been scant evidence of it flowing through to consumer inflation and becoming a worry for policymakers.

 Many analysts believe China's producer inflation may peak soon, and see consumer inflation remaining mild. The consumer price index (CPI) is mainly driven by prices of food, particularly pork, and services. The CPI likely rose 1.0 percent in March, after slowing to 0.8 percent in February, its weakest pace since January 2015, as food prices fell. Beijing is targeting consumer inflation at 3 percent this year, unchanged from 2016. China's foreign exchange reserves likely edged up in March to $3.01 trillion after unexpectedly rising for the first time in eight months in February, rebounding above $3 trillion as a regulatory crackdown and a steadying yuan helped staunch capital outflows. The rebound in reserves could ease fears in global markets that China will engineer another sharp one-off devaluation of the yuan, which would run the risk of inflaming trade tensions with the new

 U.S. administration. China announces foreign exchange reserves on Friday, followed by inflation and trade data on Wednesday and Thursday respectively, while loan and money data is expected anytime from April 10-15.OUTPUT DATA LIKELY TO SUGGEST SOLID Q1 GROWTH China will release first-quarter gross domestic product (GDP) on April 17, along with March industrial output, retail sales and fixed asset investment. Industrial output was expected to have remained at 6.3 percent in March, from 6.3 percent in Jan-Feb combined, while fixed asset investment was likely to grow 8.8 percent, down from 8.9 percent in Jan-Feb. Retail sales were expected to grow 9.6 percent in March, marginally better than 9.5 percent in Jan-Feb, which was the weakest pace in nearly two years 

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