LONDON: Britain’s trade deficit narrowed more than expected in October after big upward revisions to previous months following an error in how trade in gold was recorded, official figures showed on Friday.
Construction output fell slightly on the month and in the three months to October continued its downward trend, the Office for National Statistics said, bucking more positive signs in some industry surveys.
On Tuesday the ONS said it had made major errors in the calculation of Britain’s trade deficit between January 2015 and September 2016, due to a misclassification of figures it had received on the trade in gold.
While the error meant Britain’s record current account deficit was a bit smaller than thought in 2015 and early 2016, Britain’s trade deficit in the three months after June’s vote to leave the EU ballooned to £14.9 billion.
On Tuesday the ONS had said corrections to the data pointed to a deficit of as much as 17 billion — which would have been the largest on record — but other revisions incorporated in Friday’s data release brought it down.
Friday’s data showed the trade deficit in October alone narrowed to £1.971 billion from £5.812 billion in September .
The deficit in goods alone narrowed to £9.711 billion in October from September’s upwardly revised £13.832 billion — a much bigger improvement than economists’ forecasts in a Reuters poll for it to narrow to £11.8 billion.
But in percentage terms, goods export volumes in the three months to October declined by 2.1 per cent from the previous three-month period while imports grew 4.4 per cent, suggesting sterling’s sharp fall since June’s Brexit vote is doing little to improve the country’s balance of trade.
The ONS said the revised trade data for the three months to September would not affect headline economic growth during that period. Previously, the statistics agency said net trade had given the biggest boost to growth since early 2014. Construction figures showed output in the sector dropped by 0.6 per cent in October compared with growth of 0.9 per cent in September and economists’ forecasts of a small 0.2 per cent rise. — Reuters
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