Britain had an 8.5 billion pounds deficit in goods, and an estimated surplus of 7.2 billion in services in March, data showed.
Exports of goods increased by 4.9 percent between February and March 2014 to 24.6 billion pounds, reflecting an improvement in exports of finished manufactures, including jewelry, and cars.
Imports of goods increased by 2.8 percent over the same period to 33.1 billion pounds.
In the first quarter of 2014, British exports of goods declined by 3.7 percent to 72 billion pounds, while imports of goods shrank by 2.8 percent to 98.7 billion pounds, figures showed.
“The latest trade figures provide tentative signs that the recovery is finally broadening out to the external sector,” said Paul Hollingsworth, assistant economist at Capital Economics, in an analysis piece.
“It would be too soon to proclaim that an export renaissance is underway, and trade data is volatile on a monthly basis and prone to hefty revision,” he added.
Martin Beck, senior economic adviser to the EY ITEM Club, said in a note that March’s data still means that exports in the first quarter as a whole fell compared to the previous quarter.
But with imports dropping even faster, the overall trade deficit was almost 8 percent lower than in the last quarter of 2013, pointing to net trade adding to gross domestic product (GDP) growth in the first quarter, Beck said.
“Moreover, falling imports suggest that perceptions that the economic recovery is built on an unsustainable consumer boom are even more wide of the mark,” he added.
On the same day, the National Institute of Economic and Social Research, a British economic think-tank, projected in a monthly report that the external current balance of Britain would gradually dwindle to 68.6 billion pounds and 50.5 billion pounds in 2014 and 2015 respectively from 71.1 billion pounds in 2013.
The current account deficit, equivalent to 4.4 percent of the country’s GDP, is slightly lower than the highest current deficit of 4.6 percent of GDP recorded in 1989, ONS data showed at the end of March. (1 British pound = 1.69 U.S. dollars)
