UK Goods And Services Trade Deficit Narrows

Britain's deficit on trade in goods and services fell to £2.1bn in February, a drop from £3.9bn in January, according to the Office for National Statistics.

 

The figures come after the strongest monthly rise in exports for 7 years.

The 9.5% increase was helped by a surge in overseas chemical sales which reached an all-time high.

Exports were weak in January mainly because of widespread transport disruption due to the freezing weather conditions.

While the ONS could not definitively attribute February's rebound to better weather, it noted that it was a factor in February's improved industrial output.

The deficit on trade in goods alone fell to £6.2bn in February compared to £8.1bn in January.

This is the smallest goods trade deficit since June 2006.

Commenting on the fall to £2.1bn Ross Walker from RBS said: "It's quite a bit lower than expected, but then a month before it was quite a bit higher: there may have been some weather-related distortions, but then it may have been the usual noise.

"There's some underlying improvement, but although we'll see a steady improvement as the year progressess, net trade is not going to plug the gap in household and government consumption."

 

Source - Sky News Online

Posted Date: 13th Apr 2010