UK’s trade position continues to flat-line and net trade is set to detract from growth in Q4 – EY ITEM Club

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  • Amid a weak external environment, the outlook for trade in the near-term is pretty downbeat
  • But we are optimistic about the prospects further out, provided the Eurozone remains intact and the US is able to resolve its fiscal impasse

Nida Ali, economic advisor to the EY ITEM Club, comments on today’s trade balance figures:

“The UK’s trade position has broadly flat-lined over the last twelve months and these figures reflect a continuation of that trend. With export volumes in October and November well below the Q3 average and imports slightly higher, net trade is set to detract from growth in Q4.” 
 
Mark Gregory, EY’s chief economist added:

“Today’s figures reinforce the overall picture of a weak external environment. Despite early signs of improvement in the manufacturing sector, survey data is still pointing to an ongoing decline in export orders. This is unlikely to change anytime soon and the outlook for UK trade in the near-term is pretty downbeat.
 
“However, we are more optimistic about the prospects further out assuming that the Eurozone remains intact and that the US is able to resolve its fiscal impasse over the next couple of months.”