UK's Trade Performance With US Weakens on Strong Dollar, Fuel Imports

UK's Trade Performance With US Weakens on Strong Dollar, Fuel Imports

0832 GMT - The U.K. has recorded two consecutive quarters of a goods trade deficit with the U.S. for first time since 1998, driven by a strong dollar and rising fuel imports, analysis from Ebury shows. The deficit reached GBP3.1 billion in the first quarter, the largest-ever negative goods gap with the U.S., and GBP700 million in the second quarter. "Evidently, the devalued pound against the dollar this year has bumped up the value of imports from the U.S.," Jack Sirett, Ebury's head of dealing, writes. "As inflationary pressures continue to build in the U.K. ahead of the October energy price cap hike, the combination of growing imports from the States and a strengthening USD will add further to that volatile cocktail." ([e-mail])

 
Companies News: 

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Market Talk: 

UK Labor Market Expected to Remain Tight Despite Economic Slowdown

0841 GMT - While the June labor market report showed little change in the unemployment rate, wage data was stronger than expected and labor-force participation still remains suppressed relative to prepandemic levels, Goldman Sachs says in a note. Tuesday's sata is consistent with Goldman Sachs's view that the U.K. labor market will remain tight and wage growth will continue to be elevated despite the recent slowdown in GDP growth. Given the tight labor market and strong inflationary pressures, the American bank continues to expect the Bank of England to raise the deposit rate by 50 basis points in September and 25 basis points in November and December. ([e-mail])

Contact: London NewsPlus; [e-mail]

(END) Dow Jones Newswires

08-16-22 0547ET