UK Balance of Payments moves into Surplus in February 2020.
In February, we sold more than we bought from the rest of the World. The Balance of Payments is how we measure this*
What is the surplus?
For the three months to February;
• The surplus was £5.9 billion
• Taking out Gold transactions, the surplus was £1.4 billion
• This is the first Balance of Payments surplus since modern records began!
What has caused this?
According to Rob Kent-Smith of the ONS;
“The underlying trade balance moved into surplus in the latest three months, the first seen since comparable records began over 20 years ago. This surplus was caused by a large fall in goods imported from EU countries”
What is the figure over a longer term?
If we look at a whole year, from February 2019 to February 2020, we are in deficit, to the tune of £11.7 billion, which is less than before. It should be noted there is usually a deficit! This is because although we sell more Services than we buy; we also buy much more Manufactured Goods and Produce than we sell.
Sources & Notes
*The UK Balance of payments is how we measure the value of trade between the UK and the rest of the World. Exports are sales to the rest of the World. Imports are what we buy from the rest of the World. If we buy more than we sell, this is called a Deficit. If we sell more than we buy, this is called a Surplus. The Balance of Payments covers trade in Manufactured Goods; Services (such as legal & financial), Technology; and Investments. Investments (such as Gold trading) can affect the figures greatly, due to London being home to the second largest financial markets in the World; which is why sometimes the ONS will provide numbers with and without the impact of financial market trading.
This data comes from the ONS (Office National Statistics), which is the official government agency for this data.