Page last updated at 11:07 GMT, Wednesday, 9 December 2009

UK trade gap widens unexpectedly

VW cars waiting to be exported from Germany
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The UK's trade deficit with the rest of the world widened in October.

Imports rose more than exports, an unexpected move given the weakness of the pound, which makes foreign-made goods more expensive in the UK.

The deficit in goods and services was £3.2bn compared with £3.1bn in September, the Office for National Statistics said.

The deficit on trade in goods grew by £0.2bn to £7.1bn in October, the largest deficit since January.

Excluding oil, the volume of imports was 4.3% higher in October than September. Exports were 3.8% higher.

Economists, who were expecting a stronger rise in exports given the weakness of the pound, expressed their disappointment.

"It's pretty depressing," said Alan Clarke from BNP Paribas.

"We were hoping part of the recovery would come from [export] trade, but so far it's just not happening."

However, others welcomed indications that consumer demand had strengthened.

"Both imports and exports have gone up, but imports somewhat more than exports suggesting perhaps that there has been something of a pick up in domestic demand, which is clearly a positive," said Amit Kara, from UBS.

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