Global demand for US exports helped shrink the country’s trade gap in April in a strong sign that the American economy is picking up speed.

The trade deficit fell by more than even the most optimistic Wall Street economists were expecting and prompted many to upgrade their forecasts for economic growth in the second quarter.

The improved growth outlook further underlined the diminishing likelihood of a cut in US interest rates this year and added to a heavy sell off in bond markets.

Bruce C. Kasman, chief economist at JPMorgan, said he was raising his forecast for growth in the second quarter to 4 per cent from 2.5 per cent after an expansion of only 0.6 per cent last quarter.

Haseeb Ahmed, and economist at the bank, said: “Strong global growth conditions suggest exports will be much firmer in the coming months.”

The trade gap shrank by 6.2 per cent to $58.5bn as exports hit a record and imports fell, according to the US Commerce Department.

Exports rose 0.2 per cent to $129.5bn, as shipments of products ranging from foods and drinks to industrial supplies and consumer goods hit all-time highs.

Imports of goods and services fell 1.9 per cent to $188bn – a drop economists partly attributed to a weaker US dollar.

Peter Kretzmer, an economist at Bank of America, said: “The implication for current quarter growth is a larger estimated net export contribution, adding about 0.5 per cent to 0.75 per cent to our GDP forecast and pushing it to almost 3.5 per cent annualised.”

The politically-sensitive trade deficit with China, however, increased by 12.3 per cent to $19.4bn for the month, as US exports to the country fell 11.5 per cent to $4.8bn and imports rose 6.6 percent in April to $24.2bn.

Congress is preparing legislation to address the record trade deficit with China that is intended to put pressure on Beijing to upgrade its weak currency to make its exports less competitive.