UK Trade Deficit Narrows Sharply As Exports Jump 4.6%


The trade deficit in the United Kingdom narrowed by £3.8 billion to £2.0 billion in September 2016 from an upwardly revised £5.8 billion in the previous month. It was the smallest trade gap since May this year, as exports increased by 4.6 percent, boosted by a 8.7 percent rise in the export of goods, while imports declined by 3.6 percent.

Between September 2016 and October 2016, total exports (goods and services) increased by £2.0 billion, or 4.6 percent, to £46.4 billion, boosted by a £2.1 billion, or 8.7 percent, increase in the export of goods. Total imports (goods and services) decreased by £1.8 billion, or 3.6 percent, to £48.4 billion over the same period, reflecting a £2.0 billion, or 5.2 percent, decrease in the import of goods.

The deficit on trade in goods was £9.7 billion in October 2016, narrowing by £4.1 billion from September 2016. Exports of machinery and transport equipment, and unspecified goods increased by £0.6 billion each, with material manufactures and chemicals increasing by £0.3 billion each.

Between September 2016 and October 2016, exports of goods to EU countries increased by £0.2 billion, or 1.5 percent, to £12.4 billion, mainly reflecting an increase in exports of miscellaneous manufactures (£0.2 billion) and material manufactures (£0.1 billion). These rises were offset by a decrease in fuels (£0.2 billion). Imports of goods from EU countries decreased by £0.3 billion to £20.5 billion in October 2016; there were decreases in imports of machinery and transport equipment of (£0.4 billion) offset by rises in imports of food, beverages and tobacco (£0.1 billion).

Between September 2016 and October 2016, exports of goods to countries outside the EU increased by £2.0 billion, reflecting a rise in unspecified goods (£0.6 billion), machinery and transport equipment (£0.5 billion), chemicals (£0.3 billion) and fuels (£0.2 billion). Imports of goods from countries outside the EU decreased by £1.7 billion, reflecting falls in imports of machinery and transport equipment (£1.1 billion), material manufactures (£0.4 billion) and miscellaneous manufactures (£0.3 billion). The deficit with non-EU countries in October 2016 was £1.6 billion.

Between the 3 months to July 2016 and the 3 months to October 2016, the total trade deficit (goods and services) widened by £4.7 billion to £13.2 billion. The trade position reflects exports minus imports; the widening of the deficit reflected a greater rise in imports (+ 5 percent) than the rise in exports (+1.8 percent). Both total trade exports and imports reached 3-monthly highs in the 3 months to October 2016 of £135.5 billion and £148.7 billion respectively.

ONS | Joana Ferreira | joana.ferreira@tradingeconomics.com
12/9/2016 9:46:21 AM