Britain’s goods trade deficit with the rest of the world was wider than expected in April, after disruption to air traffic as a result of the Icelandic volcanic ash cloud hit both exports and imports, official data showed.
The Office for National Statistics said Britain’s goods trade deficit with the rest of the world widened to 7.279 billion pounds in April up from a downwardly revised 7.259 billion in March and the biggest since January. Analysts had expected a narrowing to 7.0 billion pounds.
Exports fell 0.6 percent and imports fell by 0.4 percent on the month. This was the first fall in exports since January’s weather-related decline of 5.7 percent.
The figures suggest that the weak pound is still not giving the boost to net trade that experts had hoped, dampening the prospects for a sustainable economic recovery.
“The fact that it has gone sideways and the deficit is still pretty wide is telling us that net trade is not adding to growth now and is really not going to provide the support to growth that we hoped it would a few months ago,” said Alan Clarke, economist at BNP Paribas. The ONS said the six days of flight disruption in April affected both exports and imports in the month, although it was not possible to quantify the impact. It said the flight ban will have had more of an impact on trade with non-EU countries.
The goods trade gap with non-EU countries narrowed slightly to 3.991 billion pounds, broadly in line with analysts’ forecasts. (Reuters)