UK Trade Balance Swings to Deficit

The UK posted a trade deficit of £0.72 billion in February 2026, shifting from a downwardly revised surplus of £3.02 billion in the previous month, as exports fell while imports rose. Exports dropped 1.5% mom to £80.20 billion, while imports grew 3.2% to a three-month high of £80.92 billion. Goods exports declined 3.9% to £33.26 billion, weighed down by lower shipments to both the EU (-0.7%) and non-EU countries (-2.3%). Exports to the EU fell due to small declines across several commodities. Exports to non-EU markets were driven by a £0.3 billion fall in chemical exports, along with £0.2 billion decreases in exports of both machinery and transport equipment, and miscellaneous manufactures. In contrast, exports of goods to the US rose 11.3%, amid higher machinery and transport equipment, and material manufactures. Services exports ticked up 0.3% to £46.95 billion. On the import side, goods imports grew 4.7% to £52.05 billion, while services imports rose 0.6% to £28.88 billion.

The UK recorded a trade surplus of £3.92 billion in January 2026, a sharp reversal from a £4.34 billion deficit in the previous month. This marks the first surplus since September 2024, as exports increased and imports declined. Exports rose 7.2% month-on-month to a record £82.51 billion, while imports fell 3.3% to a one-year low of £78.59 billion. Goods exports climbed 6.7% to £35.53 billion, driven by higher shipments to both EU (6.2%) and non-EU countries (7.1%). Exports to the EU was due to increases in machinery and transport equipment as well as fuel exports. Exports to non-EU markets were led by chemicals, particularly medicinal and pharmaceutical products to China, Turkey, and Brazil. In contrast, exports of goods to the US fell 11.3%, amid lower sales of machinery and transport equipment, specifically cars. Services exports edged up 0.2% to £46.98 billion. On the import side, goods imports decreased 0.6% to £49.98 billion, while services imports rose 0.4% to £28.61 billion.

The UK trade deficit narrowed to £4.34 billion in December 2025, down from a downwardly revised £5.56 billion in November. It marked the smallest trade gap since August, as exports fell less than imports. Exports dropped 1.0% month-on-month to a three-month low of £76.96 billion, while imports fell 2.4% to a three-month low of £81.30 billion. Goods exports shrank 3.2% mom to a three-month low of £30.09 billion, driven by lower shipments to EU countries (-1.9%) and non-EU countries (-4.4%), mainly reflecting a decline in exports of medicinal and pharmaceutical products to China, Japan, and South Korea. By contrast, exports of goods to the US, including precious metals, rose 2.5% due to higher exports of medicinal and pharmaceutical products and inorganic chemicals. Meanwhile, services exports grew 0.5% to £46.87 billion. On the import side, goods imports fell 3.4% to a three-month low of £52.81 billion, while services imports fell 0.5% to a three-month low of £28.49 billion.