"Recent surveys suggest export orders have improved a bit in the last couple of months"
- Vicky Redwood, an economist at Capital Economics Ltd.
The U.K. trade deficit narrowed slightly in November, as exports rose more than imports, raising the chance that trade activity during the last three months of 2012 dragged on economic growth. According to the report by the Office for National Statistics, the goods trade deficit in goods and services fell to 3.5 billion pounds in November, down from 3.7 billion pounds the preceding month. The goods trade gap was at 9.16 billion pounds compared with 9.49 billion pounds in October. The improvement was mostly supported by the 2.9% gain in exports, which rose to 24.8 billion pounds, reaching the highest level since July, while imports added only 1.1%.
"Recent surveys suggest export orders have improved a bit in the last couple of months," Vicky Redwood, an economist at Capital Economics Ltd. in London, said before the report was released. Ultimately Europe takes half of our exports so that's the really important factor."
"I suspect what (the figures) confirm is that trade will act as a drag on the Q4 (GDP) numbers," said Peter Dixon, economist at Commerzbank. "Uncertainty around the euro zone debt crisis has not only hampered UK exports, but there is also some evidence that UK firms have turned down business in parts of the euro zone due to credit risk."
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