There were warnings Britain’s economic recovery was on shaky ground on Friday after official data showed the country’s current account deficit with the rest of the world soared to its highest since 1989.
Dealing a blow to chancellor George Osborne’s push for a Britain that can “pay its way” in the world, the gap – Britain’s trade deficit, plus the losses UK plc makes on its overseas ventures – ballooned to £21bn in the three months to September from a deficit of £6bn in the previous quarter.
As a percentage of GDP, the deficit was 5.1%, the biggest share for more than 20 years, the Office for National Statistics said.
There was similarly downbeat news for the government’s push to rebalance the economy from figures on what has been driving growth, and separate ONS data showed that public finances deteriorated last month.
Graeme Leach, chief economist at the Institute of Directors, said: “As the chancellor looks at the latest GDP figures, he’s likely to reach for a glass of wine and indigestion tablets at the same time. The strength of GDP, with faster year-on-year growth, will be a cause for celebration. But the sources of that growth will make him uncomfortable.”
