By Marcus Leach

The UK’s deficit on trade in goods and services was estimated to have been £2.4 billion in May, compared with a deficit of £2.1 billion in April.

The latest figures from the Office for National Statistics (ONS) showed there was a deficit of £8.5 billion on goods, partly offset by an estimated surplus of £6.1 billion on services.

Volumes of both exports and imports of goods have recovered slightly from the low levels at the beginning of 2013. Trade prices have risen. This may reflect the lower level of sterling since early 2013.

Indications are that the surplus on services may have reduced slightly in the latest months due to a decrease in exports of travel services.

“The overall trade deficit is slightly up, but the April figure was revised down, which paints a mixed picture. Worryingly, the volume of exports in goods fell while imports increased," David Kern, Chief Economist at the British Chambers of Commerce (BCC) said.

“However revisions to last year’s figures show that the surplus in service exports was £3.8bn greater than initially estimated, confirming our view that this sector is strong and more emphasis should be placed on boosting this area of our trade balance.

“Overall, our trade deficit is still too large, and we are not making fast enough progress in rebalancing our economy towards net exports. Our recent economic survey revealed huge untapped potential among British exporters, especially in services, and releasing this potential will help to secure a sustainable recovery. The government must work to help firms penetrate new markets, and help UK exporters compete on a level playing field, when it comes to trade finance, promotion, and insurance.”

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