UK's trade deficit widens

02/09/2010 (2 h 32 m ago)

• New figures reveal £7.3bn deficit for last December • 7.6% increase in non-EU imports helps widen trade gap Britain's trade deficit with the rest of the world widened to its highest level in nearly a year, in December, as imports rose more than exports, according to official figures published today. The Office for National Statistics (ONS) said the deficit on trade in goods was £7.3bn in December, compared with a deficit of £6.8bn in November. December's figure was the highest since January 2009, while analysts had forecast a deficit of £6.63bn. The widening in the deficit was driven by a 7.6% month-on-month increase in non-EU imports, which was the biggest since March 2005. The figures also revealed that Britain's trade deficit for 2009 as a whole narrowed for the first year since 1997 after the global recession caused both imports and exports to fall at their fastest rate in over 50 years. Howard Archer, chief UK economist at IHS Global Insight, said: "The total trade deficit disappointingly and unexpectedly widened in December as imports rose more than exports. This suggests that net trade was negative in the fourth quarter of 2009 and dilutes hopes that GDP growth could be revised up from the preliminary estimate of just 0.1% quarter-on-quarter. Net trade made a negative contribution of 0.2 percentage points to third-quarter GDP, thereby preventing the economy from at least stabilizing." Economic growth (GDP) Recession Office for National Statistics Economics Kathryn Hopkins guardian.co.uk © Guardian News & Media Limited 2010 | Use of this content is subject to our Terms & Conditions | More Feeds

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