U.K. trade deficit narrows more than market expectations in October

Trade deficit in the United Kingdom narrowed more than market participants had initially anticipated during the month of October, following fall in the country’s construction output during the period.

U.K.’s trade deficit in October alone narrowed to GBP1.971 billion from GBP5.812 billion in September - an upward revision from a previous GBP5.2 billion, data released by the Office for National Statistics (ONS) showed Friday.

The deficit in goods alone narrowed to GBP9.711 billion in October from September's upwardly revised GBP13.832 billion, a much bigger improvement than economists' forecasts in a Reuters poll for it to narrow to GBP11.8 billion.

Construction figures showed output in the sector dropped by 0.6 percent in October compared with growth of 0.9 percent in September and economists' forecasts of a small 0.2 percent rise. Compared with a year earlier, output was up 0.7 percent versus forecasts for a 0.1 percent annual decline.

In addition, output was down 0.6 percent compared with the previous three months, while third-quarter construction output showed a fall of 0.8 percent, a less sharp decline than a previous estimate that it dropped 1.1 percent.

The Bank of England (BoE) expects housing investment growth to witness a slowdown to 0.25 percent in 2017, from 4.75 percent in 2016, compared with earlier forecasts of an outright fall next year, Reuters reported.

Meanwhile, the GBP/USD traded at 1.26, up 0.18 percent, while at 11:00GMT, the FxWirePro's Hourly Pound Strength Index remained neutral at 10.24 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex