Britain’s deficit on trade in goods and services increased to £1.6bn during June 2015, up from £900m in May 2015, according to the UK’s Office for National statistics (ONS) latest statistical bulletin: UK Trade, June 2015 released on Friday.
The ONS UK Trade bulletin is designed to illustrate the extent of import and export activity and is a key contributor to the overall economic growth of the UK.
According to ONS, the trade position reflects the difference between exports and imports. UK exports declined by £200m to £43.2bn between May 2015 and June this year, while imports increased by £500m to £44.8bn.
Trade in goods deficit was recorded as £9.2bn in June 2015, an increase of £800m from the previous month. Exports fell by £300m between May 2015 and June 2015, but over the same period imports rose by £500m.
Exports of goods from the UK fell by £300m to £24.9bn in June 2015. This decline was said to mainly reflect a £500m drop in exports of unspecified goods following a high export value in the previous month. There was also a decrease in fuel exports during June 2015, a fall of £400m from the month before. ONS said £300m of this decrease was due to oil. However, a £500m rise in chemicals, specifically organic chemicals, partially offset the overall decrease in exports of goods.
Imports of goods to the UK increased by £500m to £34.1bn in June 2015, with £200m of this increase were attributed to fuels (specifically oil). There was also a cumulative rise in imports of most other commodities.
During June, imports from the EU rose by £600m. This rise was primarily reflected further imports of material manufactures, machinery and transport equipment, as well as food and live animals. The increase in imports from the EU has resulted in a record trade deficit with the EU of £7.6bn for June 2015.
In the quarter from 2 April to June 2015, the UK’s total trade deficit was the smallest since quarter 2 April to June 2011, contracting by £2.7bn to GBP4.8bn. Quarterly figures for exports were recorded as increasing £2.9bn, while imports rose by £200m.
For the three months to June 2015, deficit in trade in goods narrowed by £3bn to £27.4bn, which reflects a quarterly rise of £3.1bn in exports and a £100m increase in imports. These higher export figures reflect a £1.3bn increase in exports of chemicals and a £1bn rise in exports of fuels. Machinery and transport equipment exports were less significant compared to chemicals and fuels, at over the quarter and increasing by £600m. Although these sectors accounted for £1.2bn of the overall narrowing of the goods deficit, as respective imports dropped by £600m.
ONS also reported that during the quarter April to June 2015, the surplus in UK trade in services narrowed by £300m to £22.6bn. It recorded a decrease of £100m in exports and a £200m increase in imports over the quarter.