There was a current account deficit of £7.7 billion in the third quarter of 2008, up from a deficit of £6.4 billion in the previous quarter. The third quarter deficit was equivalent to -2.1 per cent of Gross Domestic Product (GDP) compared with -1.8 per cent in the previous quarter. The higher current account deficit was mainly the result of falls in the surpluses on income and trade in services. The surplus on income was £7.5 billion, £0.8 billion lower than in the previous quarter, mainly due to a fall in the surplus on foreign direct investment; a fall in earnings on direct investment abroad outweighed a fall in foreign earnings on direct investment in the UK. The surplus on trade in services was £11.5 billion, £0.6 billion lower than in the previous quarter; the fall was predominantly driven by increased imports of other business services and by lower exports of travel and insurance services. The deficit on trade in goods widened by £0.2 billion to £23.6 billion in the third quarter, while the deficit on current transfers narrowed by £0.3 billion to £3.1 billion.
Revisions
Data are revised from 2007, primarily to incorporate the results of the Foreign Direct Investment annual inquiry as well as the results from the International Trade in Services, Insurance, Pension Funds, Unit Trusts and Investment Trusts annual inquiries.
The current account deficit in 2007 has been revised to £39.5 billion, equivalent to -2.8 per cent of GDP.
Notes: The balance of payments data are presented in current price terms.
The current account includes transactions in goods, services, income and current transfers.
Unless otherwise specified, current account figures are seasonally adjusted.
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UK Balance of Payments Press Release