Hopes that the UK economy would enjoy an export-led recovery were dented last week with the publication of new figures showing a widening trade deficit.
Official trade figures, published on Friday, suggest that the UK imported some £3.8 billion more in goods and services during May than it exported. This represents the widest deficit since July 2008.
Since the beginning of the year imports have grown by 6 per cent, while exports have risen by just 3.7 per cent.
It had been widely hoped that a weak pound would help to encourage exports, driving a recovery in the economy at large.
This was deemed particularly important in the face of impending widespread public sector cuts.
Many analysts are concerned about the apparent continuing weakness of the economic recovery, with some predicting a return to recession. Separate figures published today suggest that advertisers are cutting their predicted spends – generally seen as an indicator of further downturn.
Revised figures published this morning confirmed that the UK economy grew by just 0.3 per cent during the first quarter of 2010.