Trade deficit up as exports decline again

Tim Wallace
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EXPORTS fell and imports rose in November, reversing October’s positive figures and suggesting trade is not giving a strong boost to the UK economy, according to data released yesterday by the Office for National Statistics (ONS).

Goods imports rose by £381m in the month to £34.84bn, while exports fell by £395m to £25.74bn.

The deficit in goods rose from £7.87bn to £8.64bn.

Although oil imports increased by £117m, exports rose by £260m, decreasing the deficit in the commodity to £1.48bn in the month.

By volume, exports fell by 1.7 per cent, driven by declining consumer goods sales, although car exports rose by 6.7 per cent.

Imports rose 1.1 per cent by volume, with chemicals up 15.7 per cent.

However, imports of capital goods, such as plant machinery, fell by four per cent in the month.

“Nevertheless, net trade still looks likely to have made a positive contribution to GDP in the fourth quarter of 2011, contrasting with the third quarter when trade knocked 0.4 percentage points off growth,” said economist Howard Archer from IHS Global Insight.

“However, looking through the recent erratic monthly moves in the trade data, there is little evidence overall of marked improvement, which is disappointing for hopes that improved exports can boost overall growth and help the economy to become more balanced.”