Marc Chandler submits:The UK unexpectedly recorded a wider than expected trade deficit in December, despite the weakness of the pound.
The December visible trade deficit widened to GBP7.23 billion vs. the GBP6.7 billion expectation, and up from GBP6.8 billion in November. Additionally, the trade deficit with non-EU countries deteriorated despite evidence of growth in China and the US. The non-EU deficit widened to GBP3.5 billion from GBP3.1 billion.
Some of that widening may be due to one-off factors. Imports from non-EU countries jumped 7.6% as aircraft orders and oil rose. Still, on the export front, the ONS reported that total exports in 2009 fell by the most on record or 9.5% y/y. While the deterioration in global growth and trade likely played a major role in the drop in UK exports, the weak pound also appears to be having limited impact.
Disclosure: No positions
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