UK trade deficit to widen in May

UK trade balance data is likely to be released on 10th, July.

The deficit on goods and services narrowed sharply from £3093m in March to £1202m in April. This was largely due to a fall in the goods deficit excluding erratics. The services balance was relatively stable. Unfortunately, the business surveys do not corroborate the improvement in goods trade; they show a fall in export orders so the reduction in the deficit is not expected to last, says Societe Generale. Therefore, Societe Generale predicts the overall deficit to rise to £2000m.