Gold Prices Fall Amid Rate Jitters; Copper Steady as China Stimulus Eyed 
The latest Balance of Payments data from the Office for National Statistics (ONS), released on Friday, March 31, showed that the UK’s current account deficit was £12.1 billion in Q4 2016. This represents a narrowing of £13.6 billion from a revised deficit of £25.7 billion in Q3 2016.
The cheaper pound makes imports pricier and exports more competitive supporting an improvement in the current account, with the trade component leading the charge. The ONS reports the total trade deficit narrowed to £4.8 billion in Q4 2016, following a sharp widening of the deficit in Q3 2016 (£14.8 billion).
The primary income deficit narrowed from £4.3 billion in Q3 2016 to a three-year low of £1.0 billion in Q4 2016. ONS reported a current account deficit of £19.5 billion with the EU in Q4 2016 whilst a surplus of £7.4 billion was recorded with non-EU countries.
To a large extent, the improvements in the services surplus and income flows still reflected an anticipated swing in erratic goods categories that have little connection with underlying economic activity. Seen in that light, the strongly positive net trade contribution to growth in 2016 Q4 – of 1.7pp – seems unlikely to last.
