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UK Nov trade defict hits unexpected record high

Published 01/12/2011, 04:33 AM
Updated 01/12/2011, 04:36 AM

LONDON, Jan 12 (Reuters) - Britain's goods trade deficit with the rest of the world unexpectedly deteriorated in November to hit a record high, driven by imports of oil and aircraft, official data showed on Wednesday.

The figures will raise concerns about the rebalancing of the economy towards exports in response to sterling's relative weakness, as well as casting doubt on the scale of trade's contribution to fourth-quarter economic growth.

However, analysts are likely to draw some comfort from the fact that November's aircraft imports will probably be a one-off. Britain's trade in goods excluding oil and erratic items su ch as aircraft -- a better representation of underlying trends -- narrowed from October's record high.

The Office for National Statistics said that Britain's goods trade gap widened to 8.736 billion pounds from an upwardly revised 8.591 billion pounds in October. This was the biggest deficit since monthly records began in January 1980, and contr asts with the narrower deficit of 8.33 billion that economists had forecast.

Both exports and imports hit a record high in value terms on the month, though imports rose faster. The oil balance swung back from its unusual October surplus of 21 million pound s to a more typical deficit of 660 million pounds, as imports rose.

Imports of aircraft and aircraft parts increased by 441 million pounds on the month.

Britain trade deficit including services also widened. It increased to 4.123 billion pounds from 4.038 billion, its highest since August.

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