UK current account deficit narrowed to £21.1B, or 3.3% of GDP in Q4; primary income account recorded a surplus of £9.8B, or 1.5% of GDP: ONS

LONDON , March 31, 2023 (press release) –

A measure of cross-border transactions between the UK and rest of the world. Includes trade, income, capital transfers and foreign assets and liabilities.

Main points

• The underlying UK current account deficit narrowed to £21.1 billion or 3.3% of gross domestic product (GDP) in Quarter 4 (Oct to Dec) 2022, a fall from the £26.3 billion (4.2% of GDP) deficit the previous quarter. 
• When trade in precious metals is included, the UK current account deficit narrowed to £2.5 billion, or 0.4% of GDP in Quarter 4 2022.
• In Quarter 4 2022 the total trade deficit increased to £25.4 billion from £24.1 billion in the previous quarter; the goods deficit widened by £1.4 billion to £63.9 billion and the services surplus rose by £0.2 billion to £38.5 billion.
• The lower current account deficit in Quarter 4 2022 was due to a £6.9 billion widening of the primary income account surplus position, to £9.8 billion, or 1.5% of GDP, as credits from direct investment abroad continued to recover, especially in the energy sector.
• In Quarter 4 2022, the UK was a net borrower from the rest of the world recording a net financial inflow of £13.3 billion.
• The UK's net international investment liability position widened to £271.6 billion following a narrowing to £112.1 billion in the previous quarter.

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