The November deficit was 14.19 billion, down from a smaller revised £15.94 billion in October and well below the market consensus. This was the least red ink since April but mainly reflected a 3.3 percent monthly drop in imports. Exports advanced only 0.4 percent.

The shortfall with the EU narrowed from £12.02 billion to £11.35 billion as exports rose 1.4 percent and imports fell 1.7 percent. With the rest of the world, the deficit stood at £2.84 billion, down from £3.92 billion and a 4-month low.

The monthly data continue to be very volatile and subject to hefty revision leaving a clouded underlying picture. However, both sides of the balance sheet have shrunk appreciably since the start of 2023 so neither exports nor imports are doing much to bolster economic activity. That said, today's updates put the UK RPI at 21 and the RPI-P at 16. Both readings show a moderate degree of overall economic outperformance making no change in Bank Rate at the BoE's MPC meeting next month all the more likely.

The November deficit is put at £15.7 billion, down from October's £17.03 billion.

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.