"The prospects do not look great for a further positive contribution from net trade to GDP growth in the fourth quarter ..."
- Howard Archer, UK economist at IHS Global Insight
Britain's trade performance improved more than expected in September, helped by the stronger exports and weaker imports, however, trading outlook remains bleak due to the deepening eurozone's debt crisis. The U.K. trade gap narrowed £8.4bn in September, down from £10.0bn in the prior month. At the same time, exports soared 1.1%, while imports erased 3.9%. In the meanwhile, exports to the European Union in the third quarter were 2.5% lower from a year earlier, adding to concerns that the demand may be dampened even further, if leaders in the eurozone still are unable bring the sovereign debt crisis to an end.
"The prospects do not look great for a further positive contribution from net trade to GDP growth in the fourth quarter given the pressure on exports coming from ongoing very weak domestic demand in the eurozone and generally soft global growth. Indeed, the latest survey evidence on foreign orders is soft and weakened in October," said Howard Archer, UK economist at IHS Global Insight.
The FTSE 100 Index turned lower 0.11 per cent to 5,769.68. The broader FTSE All-Share Index fell 0.16 per cent to 3,014.98.
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