UK trade deficit fell in June

The UK's trade deficit shrank to £1.5 billion in June from £2.6 billion in May - its lowest level this year, data from the Office for National Statistics (ONS) has shown.

An £8.1 billion deficit on goods was offset by a surplus of £6.5 billion on services.

The ONS trade deficit data, which measures the difference between imports and exports, also shows the continuing growth of exports to emerging markets outside the EU, increasing by £1.3 billion in the month to £14.2 billion. Trade to countries within the EU remained relatively unchanged.

Overall, export goods reached £78.4 billion in the second quarter of 2013 - the highest level on record. Imports of goods also increased to £103.3 billion in the same period - the highest level since the three months to November 2011.

Separate data also showed that output in the construction industry increased by 1.4 per cent in the second quarter of 2013.
David Kern, chief economist at the British Chambers of Commerce, welcomed the news but said the deficit was 'still too large'.

"The large fall in Britain's trade deficit is yet more positive news for the economy, with longer-term comparisons signaling an improvement in the UK's trading performance. Britain's exporters are now starting to focus more on trade with countries outside the EU. This is particularly encouraging as these countries are growing at a faster rate and will be the ones that provide the greatest opportunities for UK firms."

"Despite these improvements, our trade deficit is still too large and we aren't making enough progress in rebalancing our economy towards net exports. Our recent surveys reveal huge untapped potential among British exporters, especially in the service sector, and unleashing this potential will help to secure a sustainable recovery."