UK: Foreign trade slowdown

Recent figures from foreign exchange company, World First, reveal that international trade by SMEs dropped significantly in the first quarter of 2017 due to pressure from increased importing costs and lower margins

World First’s Global Trade Barometer showed that businesses have been cutting back on foreign trade, transferring 17% less on average per currency transaction in comparison to the last quarter of 2016.

World First’s Global Trade Barometer showed that businesses have been cutting back on foreign trade, transferring 17% less on average per currency transaction in comparison to the last quarter of 2016. Another indicator from the same report is the increasing proportion of SMEs who have not made any foreign currency transactions, rising to 64% from 28% over the same period.

Jeremy Cook, Chief Economist at World First, suggested that the slowdown could point to falling confidence, stating that ‘higher costs of importing materials and squeezed margins are seeing businesses pull back from international trade’. The figures also suggested that currency volatility, in addition to rising inflation, could be contributing to a lack of confidence in foreign trade.

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