London: Britain’s trade deficit widened in the fourth quarter as exports fell, underscoring the economy’s reliance on domestic spending.
The value of imported goods and services outstripped exports by £10.3 billion (Dh54.6 billion) compared with £8.6 billion in the third quarter, the Office for National Statistics said in London on Tuesday.
In December alone, the deficit narrowed to £2.7 billion, with the shortfall in goods falling to £9.9 billion. Both were narrower than economists forecast.
The figures put a spotlight on Britain’s unbalanced economy, which is being driven by consumer spending and the dominant services sector as global turmoil holds back exports and manufacturing. Bank of England officials indicated last week they are in no hurry to raise the benchmark interest rate from a record-low 0.5 per cent.
Total exports fell 0.8 per cent in the fourth quarter. In December alone, goods exports declined 0.3 per cent and imports dropped 4.8 per cent. The value of oil imports fell 11 per cent to £1.9 billion, the lowest level since February 2009, reflecting falling prices.
Net trade knocked 1 percentage point off growth in the third quarter and looks set to have been a drag again in the fourth. Gross domestic product estimates on February 25 will include volume-based figures for trade, investment and private consumption.
In 2015, the trade deficit widened to £34.7 billion, the most since 2010. At £125 billion, the goods-trade deficit was the largest on record. Trade last provided a spur to the economy in 2011.
