UK trade deficit widens in Jan as non-EU exports dive

Britain's goods trade gap with the rest of the world widened more than expected in January, as a record trade deficit with non-EU countries outstripped an improvement in the trade gap with Europe.

The Office for National Statistics said that Britain's goods trade gap widened more than expected to 7.745 billion pounds in January from 7.232 billion pounds in December, above analysts' forecasts for a deficit of 7.45 billion pounds.

The goods trade gap with non-EU countries also widened more than expected to a record 5.704 billion pounds from 4.340 billion pounds in December. Analysts had forecast a deficit of 4.25 billion pounds.

The ONS said exports to EU countries rose nearly 6 percent, taking the trade deficit with Britain's biggest trading partner to its narrowest since August 2003.

The figures suggest the pound's weakness may be helping boost exports to European countries, but demand for British goods from further afield has fallen sharply.

Exports to non-EU countries fell nearly 16 percent in January, while imports from those countries fell 0.3 percent.

The ONS said demand from non-EU countries fell broadly across manufacturing sectors.