The U.K. visible trade deficit narrowed more-than-expected to a near 1-year low in June, thanks to record exports amid slower increase in imports.
The deficit on goods trade declined to GBP 8.1 billion in June, the lowest since July 2012, from GBP 8.7 billion in May, the report released by the Office for National Statistics showed Friday.
The decrease of GBP 0.6 billion remains within the range of normal month-on-month movement, the ONS said. The number was also below the expected GBP 8.35 billion deficit.
The visible trade deficit was partially offset by an estimated surplus of GBP 6.5 billion on services. As a result, the total trade deficit fell to GBP 1.5 billion from GBP 2.6 billion in the previous month.
Exports of goods rose by GBP 1.3 billion to a record GBP 26.9 billion in June, while imports increased by a moderate GBP 0.7 billion to GBP 35 billion.
In the second quarter, the deficit on trade in goods reduced to GBP 24.9 billion from GBP 26.5 billion in the previous quarter, the ONS said.
Exports of goods reached GBP 78.4 billion, the highest on record. Likewise, imports of good increased to GBP 103.3 billion, the strongest level since the three months to November 2011.
Exports to countries outside the EU climbed 7.5 percent to over GBP 40 billion for the first time. At the same time, exports to the EU countries gained 2.3 percent.
Looking ahead, IHS Global Insight's Chief U.K. Economist Howard Archer said the hope is that a competitive pound and gradually improving global growth increasingly supports exports.
Nonetheless, Capital Economics' economist Martin Beck said growing signs of a consumer-led recovery, as well as the increased import demand implies that the trade deficit will probably struggle to narrow further over the coming months.
Another report from ONS revealed that construction output advanced 1.4 percent sequentially in the second quarter. It was estimated to have increased by 0.9 percent, while calculating GDP figures. But the agency said the revision has no effect on initial GDP estimate.
According to preliminary estimates, the pace of economic growth doubled to 0.6 percent from 0.3 percent in the first quarter.
news.instaforex.com »2013-08-09 17:42