Given that the pound has plummeted in value in the last two years, it would be a miracle if the trade deficit hadn’t fallen. British goods are much cheaper for the rest of the world to buy.

Equally, the goods we import from the rest of the world have become much more expensive.

So I wouldn’t trumpet this as a great Labour economic achievement too much…

So I wouldn’t trumpet this as a great Labour economic achievement too much…

Err why not? This is why I celebrated the fall of the pound – it would help the trade balance.

Thank goodness we kept the pound, eh?

That is indeed Gordon’s main (only?) achievement.

From the ONS release:

“The seasonally adjusted surplus on trade in services was £4.1 billion in February”

Thank goodness we’ve all those bankers flogging services to foreigners, eh?

(Yes, The City is the largest net exporter)

More from the report:

“Excluding oil and erratic items, the seasonally adjusted volume of exports was 6.3 per cent higher
but the volume of imports was 1.4 per cent lower in February, compared with January.
Export prices of goods rose by 0.5 per cent and import prices of goods rose by 0.3 per cent,
compared with January.”

If imports are down (prices are up less than the total has fallen meaning that total imports fell) this indicates a slowing UK economy, not rising. Exports influence the other way of course.

Very good numbers and an indication that British industry is using the lower effective sterling rate to win market share and not just boost profit margins. It is encouraging to see a growth in exports to the rest of the world and away from the focus on the moribund EU market. The current account could be balanced by the end of the year pleasing those who overly fret about the current account.

5. Tim Worstall

‘ If imports are down (prices are up less than the total has fallen meaning that total imports fell) this indicates a slowing UK economy, not rising. Exports influence the other way of course. ‘

Not necessarily as a lower exchange rate leads to import substitution. Moreover, in a globalised interconnected world you can’t just imagine a straight swap on imports/exports, as items appearing as imports can be the same items exported in a different form so to speak.