The deficit on overall goods trade widened from a smaller revised £12.26 billion in October to a larger than expected £15.62 billion in November, a 3-month high. The deterioration reflected a 3.9 percent monthly fall in exports compounded by a 3.5 percent increase in imports. Annual export growth now stands at 28.7 percent while its import counterpart clocks in at 22.4 percent.

Excluding precious metals, exports rose 0.7 percent while imports climbed 3.5 percent. Within this, sales to the EU fell 2.7 percent with purchases from the region advancing 4.7 percent. However, after removing the effect of inflation, the total trade deficit, excluding precious metals, narrowed by £5.1 billion to £9.8 billion in the three months to November 2022.

Today's update puts the ECDI at minus 3 and the ECDI-P at 5, both measures indicating that overall economic activity is performing much as expected.

The global goods deficit is put at £14.9 billion in November, up from £14.48 billion in October.

The merchandise trade balance measures the difference between imports and exports of goods. The level of the international trade balance, as well as changes in exports and imports, indicate trends in foreign trade and can offer a guide to an economy's competitiveness. Data are supplied by over 30 sources including several administrative sources, HM Revenue and Customs (HMRC) being the largest.

Changes in the level of imports and exports, along with the difference between the two (the trade balance) are a valuable gauge of economic trends here and abroad. While these trade figures can directly impact all financial markets, they primarily affect currency values in foreign exchange markets.

Imports indicate demand for foreign goods and services in the UK. Exports show the demand for UK goods in countries overseas. The pound sterling can be particularly sensitive to changes in the trade deficit run by the United Kingdom, since the trade shortfalls create greater net demand for foreign currencies. The bond market is also sensitive to the risk of importing inflation. This report gives a breakdown of trade with major countries as well, so it can be instructive for investors who are interested in diversifying globally. For example, a trend of accelerating exports to a particular country might signal economic strength and investment opportunities in that country.

The UK's trade balance is particularly susceptible to swings in the oil account and so within the overall goods balance, financial markets will normally focus on the balance excluding oil and other erratic items.