Net trade made significant contribution to GDP growth in Q3 – ITEM Club

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  • With exports rising sharply in Q3 and imports falling slightly, net trade appears to have contributed strongly to GDP growth.
  • But the monthly data can be very volatile and the UK's trade position has seen little improvement since the start of the year
  • Amid a general global economic slowdown, the near-term outlook for UK exports remains troubled

Nida Ali, economic advisor to the EY ITEM Club, comments on today’s trade balance figures:
 
“With exports rising sharply in Q3 and imports falling slightly, it looks like net trade contributed strongly to GDP growth.

“However, the trade data can be very volatile from month to month. The stronger Q3 data merely goes some way to reversing the dire figures from Q2. The UK's trade position has seen little improvement since the start of the year and the broader picture of a weak external environment is still unchanged.
 
Mark Gregory, EY’s chief economist added:

“Amid a general global economic slowdown, recent survey data suggests that manufacturers are seeing export orders falling both from the US and Europe, as well as emerging markets. The near-term outlook for UK exports remains troubled and the search for more balanced economic growth goes on.”