Britains Economy Showing Signs Of Strengthening

10 Aug 2013

Seeing the signs of an advancing recovery due to the rise in the second quarter exports, the Bank of England decided to keep their policy loose to encourage the recovery. According to report from the Office for National Statistics, the deficit on goods trade has reduced from 26.5 billion pounds to 24.9 billion pounds, and the overseas sales increased to 78.9 billion pounds. With indexes of construction, manufacturing and services improving in July, Britain’s Economy is displaying signs of strengthening.

Mark Carney, Governor of Bank of England said that the Central Bank plans to its key interest rate low for the next three years as UK is at its very early stages of recovery. Economists at HSBC Holdings Plc, John Zhu and Simon Wells stated in an e-mailed note that after years of stagnation, UK trade finally looks on a slow path to recovery and the higher exports will support the theory that there is demand in UK’s produces.

In the past three months, the deficit on goods and services narrowed down from 6.1 billion pounds to 5.9 billion pounds. For the first time, the sales increased 7.5%, exceeding 40 billion pounds, and the surge in the goods export was driven by the demand from outside the European Union. According to the report, the foreign sales were driven by intermediate goods, which rose 814 million pounds in the quarter. Exports of consumer goods excluding cars and semi-manufactured products have also increased. Investing in UK may be a good idea seeing the slow and steady increase in the economy.

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