The UK’s trade deficit on goods contracted in September to £7.5 billion – an improvement of half a billion pounds against the figures for August – according to a release today from the Office for National Statistics.
The amounted of imported goods did rise by £0.1bn but this was offset by £0.6bn more exports. The rise in imports has been attributed to more intermediate goods (raw materials and components), cars, and chemicals being brought in from abroad. The export rise was down to oil.
Import and export prices rose and fell by 0.5 per cent respectively in September, compared with the previous month.
Analysts say the development is good news for British business as it proves the weaker pound is proving its advantages. Howard Archer, chief UK and European economist at IHS Global Insight exercised an air of caution however.”While UK exporters will benefit from the markedly weaker pound, this seems certain to be increasingly countered over the coming months by very weak domestic demand in key overseas markets,” he said.
When services are taken into account the overall trade deficit is now £3.9bn, again down half a billion pounds on August.