UK goods trade deficit narrows to $26.2B in August, below expectations

Goods imports fall 2.3%, exports decline 3.1%, while 3-month goods and services deficit widens to $10.6B

The UK's goods trade deficit stood at £19.8 billion ($26.2 billion) in August, below market expectations of £21.9 billion, as imports fell more than exports, official figures showed Thursday. The deficit, excluding precious metals, narrowed by £200 million from July, according to the Office for National Statistics (ONS). Goods imports decreased 2.3% month-on-month to £54.2 billion, while exports fell 3.1% to £34.4 billion. Imports from non-EU countries dropped 6.3% to £25.6 billion, driven primarily by lower purchases of machinery and transport equipment following a record increase in July. Aircraft imports from the US and ship imports from China declined. Imports from the EU rose 1.6% to £28.6 billion, supported by higher purchases of German aircraft and pharmaceutical products, alongside refined oil from the Netherlands. Goods exports to the EU fell 7.3% to £15.8 billion, reflecting declines in machinery and transport equipment, manufactured materials, fuels and chemicals. Lower aircraft exports to the Netherlands and reduced crude oil shipments to Germany, Poland and Italy contributed to the fall. Exports to non-EU countries increased 0.9% to £18.6 billion, supported by higher shipments of inorganic chemicals to the US. After adjusting for inflation, total goods imports fell 2.5%, while exports declined 2.8%.   3-month trade deficit widens The total goods and services trade deficit widened by £1.4 billion to £8 billion ($10.6 billion) in the three months to August compared with the three months to May. The goods deficit increased by £2.5 billion to £59.1 billion, partly offset by a £1.1 billion rise in the estimated services surplus to £51.1 billion. Early estimates for August showed services exports increased 0.4% from July, while imports rose 0.2%.