UK Trade Deficit Increases to £3.4bn, According to ONS

The UK’s deficit on seasonally-adjusted trade in goods and services was £3.4bn in February, compared with the deficit of £2.5bn in January, according to the Office for National Statistics. The deficit on seasonally-adjusted trade in goods was £8.8bn in February, compared with the deficit of £7.9bn in January.

The surplus on seasonally-adjusted trade in services was estimated at £5.4bn in February, unchanged compared with January. Excluding oil and erratic items, the seasonally-adjusted volume of exports was 5.3% lower, and the volume of imports was 0.9% lower in February, compared with January. Export prices of goods rose by 1.5% and import prices of goods rose by 0.7%, compared with January.

Kah Chye Tan, head of trade and working capital, Barclays, said: “UK trade is in a better position today than 12 months ago, though exporters remain cautiously optimistic. Markets remain nervous with the slightest element of negative sentiment having disproportionate effect. Strikes and civil unrest are clearly very unsettling as austerity measures bite with no real end in sight.

“While the BRIC [Brazil, Russia, India and China] countries and other developing nations are continuing to see significant growth, there are increasing signs of overheating which may stifle demand in due course. Exporters though are encouraged to tap into the many opportunities that currently exist in these markets especially given the lack of growth that Europe is set to endure for the foreseeable future.”


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