Today’s UK trade figures took stock markets and analysts by surprise with an increase in the trade deficit at a time when many felt the UK was back on track and moving towards a growth period. While there are a number of suggestions as to why the UK trade gap widened in January ultimately it seems that a significant drop-off in exports has hit the UK economy very hard.

One of the main issues which many analysts and economists have is the ever growing dependence on the Eurozone and the fact that this area of the worldwide economy is struggling at the moment. The Greek crisis has reduced confidence in the area and while initially the European Union appeared to have the situation under control, recent backtracking by the German government has concerned many in the market place. The UK, while not officially part of the Eurozone, still carries out significant trade with Europe and this is still a vital market for the UK economy.

Just a few months ago the Eurozone appeared to be on the way to recovery while the UK was lagging behind due to an ever growing budget deficit. However, at the moment it would appear that the UK is ready to move forward but may well be held back by a weak Eurozone, at least in the short term.

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