UK trade deficit hits record high

City A.M. Reporter
Britain's goods trade deficit with the rest of the world unexpectedly deteriorated in November to hit a record high, driven by imports of oil and aircraft, official data showed.

The figures will raise concerns about the rebalancing of the economy towards exports in response to sterling's relative weakness, as well as casting doubt on the scale of trade's contribution to fourth-quarter economic growth.

However, analysts are likely to draw some comfort from the fact that November's aircraft imports will probably be a one-off.

Britain's trade in goods excluding oil and erratic items such as aircraft – a better representation of underlying trends – narrowed from October's record high.

The Office for National Statistics said that Britain's goods trade gap widened to £8.736bn from an upwardly revised £8.591bn in October. This was the biggest deficit since monthly records began in January 1980, and contrasts with the narrower deficit of £8.33bn that economists had forecast.

Both exports and imports hit a record high in value terms on the month, though imports rose faster. The oil balance swung back from its unusual October surplus of £21m to a more typical deficit of £660m, as imports rose.

Imports of aircraft and aircraft parts increased by £444m on the month.

Britain trade deficit including services also widened. It increased to £4.123bn from 4.038bn, its highest since August.