"The data is extremely volatile and so we wouldn't read too much into monthly movements".
- Paul Hollingsworth, Capital Economics
The United Kingdom's trade deficit narrowed in the Q3 despite the post-Brexit uncertainty, official data revealed on Wednesday. According to the Office for National Statistics, the total British trade deficit dropped to 11.0 billion pounds in the Q3, following the preceding quarter's gap of 12.7 billion pounds ($15.8 billion), the highest level since 2013. Furthermore, even though the deficit on trade in goods jumped to 12.7 billion pounds in September, as the deficit with the EU increased to 8.7 billion pounds from 7.9 billion pounds, it narrowed to 33.2 billion pounds for the whole Q3. In the meantime, the trade in goods and services deficit climbed to 5.2 billion pounds in September, compared to the previous month's 3.8 billion-pound gap. The growth of exports was mainly driven by the weak British Pound, which dropped around 18% against the US Dollar and fell markedly against other major currencies following the country's decision to leave the European Union. Nevertheless, the fall in the value of the Sterling is likely to widen the trade gap as the cost of imports rise. Moreover, Donald's Trump win in the US presidential election is expected to increase the already exciting uncertainty that will markedly impact the GBP/USD pair and British exports.