UK Exports Fell in June Widened Trade Gap

Britain’s trade position worsened in June, as exports fell for a third month in another blow to the government’s ambitions to rebalance the economy.

The trade in goods deficit widened unexpectedly to £9.4bn from £9.2bn in May after British exports fell more than imports according to the Office for National Statistics (ONS). Economists had expected the deficit to shrink to £8.8bn, and said that tensions between Russia and the west, a weak eurozone economy, and a strong pound making British goods more expensive abroad, were all likely to weigh on foreign demand for UK goods in the short term at least.

Chris Williamson, chief economist at Markit, said Britain’s trade position was likely to deteriorate in the coming months, weighing on UK growth.

“The trade figures are some of the worst seen in recent history. Exporters are being hit on two front. First, by an appreciating exchange rate, which has risen 10% over the past year.

“Second, already weak demand in many overseas markets is being hit further by growing uncertainty about the Ukraine crisis, especially in northern Europe. Escalating geopolitical events in Gaza and Iraq add to the sense that global risk aversion is creeping higher, which will inevitably mean slower economic growth.”

via The Guardian

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza