Britain’s trade deficit was little changed in November as exports rose, led by chemicals and intermediate goods.
The goods trade gap was at 9.16 billion pounds ($14.7 billion) compared with 9.49 billion pounds in October, the Office for National Statistics said today in London. The median forecast in a Bloomberg News survey of 20 economists was 9 billion pounds. Exports increased 2.9 percent to 24.8 billion pounds, the highest since July. Imports rose 1.1 percent.
U.K. business confidence improved in the fourth quarter and gauges of export orders increased, according to a British Chambers of Commerce report yesterday. Still, the recovery this year is likely to be modest, it said. Bank of England policy makers will keep their bond-purchase program unchanged this week as they gauge signs of economic improvement, economists said before a decision tomorrow.
“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. “But with the euro-zone recession deepening a significant improvement in the trade balance is unlikely. Ultimately Europe takes half of our exports so that’s the really important factor.”
Exports of chemicals rose by 446 million pounds in November, and overseas sales of intermediate goods increased by 130 million pounds, the ONS said.
The pound remained higher against the dollar after the report was released. It was at $1.6070 as of 9:32 a.m. in London, up from $1.6056 yesterday.
Today’s report also showed that exports to the European Union increased 8.9 percent in November from October, while imports rose 4.3 percent. The deficit with the 27-nation bloc narrowed to 4.65 billion pounds from 4.99 billion pounds.
The services trade balance was at 5.7 billion pounds in November, compared with 5.76 billion pounds the previous month. That left the total trade deficit at 3.47 billion pounds.
In the three months through November, the goods-trade gap was little changed at 27.1 billion pounds from the previous three-month period. Exports fell 1.2 percent.
The statistics office said that in the 11 months through November the goods-trade deficit has been running at an average 8.9 billion pounds a month. The gap in the same period of 2011 averaged 8.4 billion pounds.
In a separate report, the ONS said non-financial companies’ net rate of return was 12.2 percent in the third quarter, compared with 12.1 percent in the three months through June.
The Bank of England’s Monetary Policy Committee will keep its bond-purchase program at 375 billion pounds tomorrow, said all 39 economists in a Bloomberg News survey. It will also leave the benchmark interest rate at a record-low 0.5 percent, according to a separate poll.