P.M. BRIEFING : UK’s August Deficit Is 3rd-Worst
Britain today notched up its third worst monthly current account deficit--a gap of $3.2 billion in August.
The deficit was a fractional improvement over a revised shortfall of $3.54 billion in July but was much larger than economists had expected.
The pound fell on the news by almost one cent to $1.6050 but recovered soon afterward and by mid-morning in New York was trading at $1.6210.
Financial analysts said the deficit in the current account--a balance of payments for imports and exports and invisible items such as banking, insurance and tourism--was a blow to the Conservative government’s hopes of cooling the economy through its policy of high interest rates.
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