5. Trade

The latest trade figures showed continued strength in goods exports in November 2016. Although the UK trade in goods deficit worsened in November – to £12.2 billion from £9.9 billion – the overall value of goods exports rose 2.8% in the month and by 13.5% in the year to November. Exports rose most strongly to the EU (8.7%) but this coincided with a 9.4% rise in imports from the EU, leading to a widening of the EU goods trade balance (Figure 3). The trade balance with the “rest of the world” widened to a greater extent – with exports to this group falling 2.4% while imports rose 7.0%.

It should be noted that trade prices have been heavily influenced by recent sterling movements. Goods export and import prices have fallen slightly in November (by 1.9% and 1.0 % respectively), coinciding with sterling appreciating by 2.7% against a basket of currencies. Additional information on sterling movements and its effect on trade prices can be found in the Economic Review and Producer Price Inflation publications.

Lower trade prices have also coincided with a 1.1% fall in the total input price index (the prices manufacturers are charged for intermediate inputs used in the production process) and flat output price growth (the prices charged for finished manufactured goods) in the month to November.

More broadly, the IMF global commodity price index (on a dollars basis) also fell by 1.2% in November 2016 but remains 9.5% higher compared with November 2015.