Car imports widen UK’s September trade deficit by £1.1bn
Wednesday, 11 November 2009
The UK’s trade deficit widened by more than expected in September, according to the latest figures from the Office for National Statistics.
The deficit on trade in goods widened by £1.1bn to £7.2bn, compared with £6.1bn in August, driven by a rise in car imports from foreign carmakers. Overall imports rose by £1.9bn (7.5%) compared to growth in exported goods of £700m (3.9%).
It was the highest level for the trade deficit since the beginning of the year and came as analysts were expecting the negative trade balance to narrow.
The UK imported an additional £400m worth of cars in September from August, which represents an increase of 29.2% over the month as UK consumers took advantage of the car scrappage scheme, which gives owners of older cars £2,000 towards a new model. Imports of oil rose by £200m.
Benjamin Williamson from the Centre for Economics and Business Research said: “Today’s news that the trade deficit widened considerably in September is likely to have a negative impact on the second estimate for third quarter economic growth in the UK, which is released towards the end of the month.”
He added export growth is |expected to outpace import growth over the long term.
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