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UK trade gap widens

THE UK's goods trade deficit with the rest of the world has grown to its widest since August 2008, official figures have shown.

Exports in January plummeted by almost 7 per cent leaving the deficit at £7.987bn compared with £7.01bn in December.

The figures were disappointing because the weak pound was expected to boost exports.

The ONS said it was unclear what impact the icy conditions in January had made on the movement of goods.

Analyst Alan Clarke,of BNP Paribas said: "It's a pretty disappointing number. Trade is one area where people have been expecting an improvement but it doesn't seem to be happening.

"In the big picture this is bad news for quarter one GDP."

Head of Trade Product at Barclays Iain MacDonald said: "The widening trade gap reported in today's figures will be cause for further concern over the UK’s ability to fully recover in the short term.

"Sluggish growth and fiscal instability in markets which have traditionally been UK exporting destinations will have contributed to the imbalance in trade."