UK Trade Deficit Narrows to 5-Month Low

The UK's trade deficit narrowed sharply by GBP 2.0 billion to GBP 0.965 billion in February 2018 from a downwardly revised GBP 2.949 billion in the previous month and below market expectations of a GBP 2.6 billion gap. It was the smallest trade deficit since September.

Imports of goods and services to the UK fell by 4.8 percent to GBP 53.41 billion in February from the previous month's record high of GBP 56.11 billion. The sharp decline was due to a 6.5 percent decrease in purchases of goods, led by fuels and manufactured goods, and a 0.2 percent drop in imports of services. Among trading partners, imports of goods from the EU fell 0.8 percent, mainly from France (-3.9 percent) and the Netherlands (-1.9 percent). In addition, purchases from non-EU countries slumped 13.3 percent, as imports decreased the most from Norway (-32 percent), the US (-20.1 percent) and Japan (-16.1 percent).

Exports of goods and services from the UK declined by 1.3 percent to GBP 52.45 billion in February from GBP 53.16 billion in the previous month, due to lower sales of goods (-2.2 percent) and services (-0.3 percent). Among major trading partners, exports of goods to non-EU countries shrank 4.7 percent, namely to the US (-17.1 percent), China (-7.1 percent), Hong Kong (-7.5 percent) and South Korea (-11.8 percent). By contrast, exports of goods to the EU grew slightly by 0.3 percent, as sales increased mainly to Germany (8.2 percent) and Ireland (3 percent), but fell to the Netherlands (-5.9 percent) and Spain (-9.8 percent).

In the three months to February 2018, the trade deficit widened by GBP 0.4 billion to GBP 6.4 billion, due mainly to a GBP 2.1 billion fall in non-EU goods exports, partially offset by increases of GBP 0.9 billion in EU goods and GBP 0.4 billion in total services exports.

UK Trade Deficit Narrows to 5-Month Low

ONS | Joana Ferreira |
4/11/2018 9:04:23 AM