Forex News – Sterling tumbles on weak UK trade deficit data

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Sterling fell to a London session low against the dollar after data showed the UK trade deficit deteriorated to its widest on record in September. The main driver was a 1.2 billion pound surge in imports, mainly of oil, chemicals and silver, while exports rose by less than 0.1 billion pounds.

Sterling fell to a session low against the dollar, touching $1.5996 , losing 0.7 percent since the London session open from a $1.6114 high.

The UK Office for National Statistics said that Britain’s goods trade deficit widened to 9.814 billion pounds in September from an upwardly revised 8.617 billion pounds in August. Economists had forecast a much smaller widening in the deficit to 8.0 billion pounds.

The British economy has not shown any substantial growth in the past two years and a sharp slowdown in the UK’s main trading partners is worsening the situation risking pushing the country back into recession. UK is already suffering the adverse effects of the euro-zone crisis, and with domestic demand hit by deficit-fighting austerity measures and export sales falling, it is hard to see what will drive economic growth in coming months .