* U.S. exports grew 4.6 percent to record $172.7 billion
* U.S. imports rise 4.9 percent to $220.8 billion
* Weaker dollar giving U.S. exports a boost - analysts
(Recasts, adds analyst quotes, details on dollar)
By Doug Palmer
WASHINGTON, May 11 (Reuters) - U.S. exports set a record in
March, buoyed by the weak U.S. dollar and strengthening global
demand as U.S. trade flows returned to levels last seen before
the global financial crisis.
U.S. exports grew 4.6 percent in March to $172.7 billion,
surpassing the record set in July 2008 before world trade took
a sharp downturn. The March export rise was the biggest
month-to-month gain in 17 years, the Commerce Department said
in a report on Wednesday.
"It's taken two-and-a-half years, but the level of exports
has finally returned to pre-recession levels," said Paul Dales,
senior U.S. economist with Capital Economics in Toronto.
Despite the big gain, the U.S. trade deficit grew to $48.2
billion in March, the widest since June 2010, as rising oil
prices helped push imports nearly 5 percent higher.
Dales said he doubted the wider-than-expected trade gap in
March would meaningfully worsen estimates of already weak
first-quarter U.S. economic growth.
"More generally, the latest surveys suggest that export
growth will continue to accelerate, with the lower dollar
providing further support. But the surveys suggest that imports
will continue to grow at a faster rate," Dales said.
Both U.S. goods and U.S. services exports set records in
March, as did two sub-categories - foods, feeds and beverages
and industrial supplies. U.S. exports to Canada and South and
Central America also set records and exports to the European
Union were the highest since July 2008.
A weaker dollar helps U.S. exports by making them cheaper
in world markets. The dollar has fallen 5.2 percent against a
basket of currencies since the beginning of the year. Against
the euro, the dollar has been down nearly 7 percent so far this
Imports grew 4.9 percent to $220.8 billion as the average
price for imported oil hit $93.76 per barrel, the highest since
September 2008. Oil prices continued to rise in April, but have
receded in recent weeks back to early March levels.
Pierre Ellis, senior global economist at Decision Economics
in New York, said the trade data could provide ammunition for
members of the Federal Reserve board that want to tighten
monetary policy to curb the threat of inflation.
"This is a reassurance on growth, which is what the hawkish
members of the Fed are looking for. This is a piece of evidence
for them to consider removing accommodation before things start
overheating a couple of years down the road," he said.
Graphic - U.S. trade balance:
Graphic - U.S. mortgages:
U.S. imports were the highest since August 2008, just as
the global financial crisis was beginning to bite into trade.
Imports hit a record $232.1 billion in July 2008, before
tumbling sharply over the next six months.
U.S. petroleum imports were also the highest since August
2008 and the U.S. petroleum trade deficit was the widest since
The closely watched U.S. trade deficit with China narrowed
slightly in March to $18.1 billion, as U.S. exports to that
country grew faster than imports from the Asian giant.
However, the trade shortfall with China for the first
quarter of 2011 totaled $60.2 billion, putting it on a pace to
exceed last year's record of around $273 billion.
China's own data this week showed it posted its biggest
surplus in four months in April, as exports hit a record on
stronger global demand.
U.S. and Chinese officials sparred over China's exchange
rate policies during high-level talks this week in Washington.
The United States pressed for a faster rise in the yuan's
value to help bring trade into balance, while China said it
would continue exchange rate reform at its own pace.
Meanwhile, a Labor Department report showed U.S. job
openings in March were the most in 2-1/2 years, pointing to a
firmer tone in the labor market. Job openings rose 99,000 to
3.12 million, the highest since September 2008.
A separate industry group report showed applications for
U.S. home mortgages surged last week at the fastest pace in two
months as interest rates dropped for a fourth week in a row.
The Mortgage Bankers Association said its mortgage
application index, which includes both refinancing and home
purchase demand, jumped 8.2 percent last week. The index of
loan requests for home purchases climbed 6.7 percent.
(Additional reporting by Richard Leong in New York, Editing by