United Kingdom Current Account

The UK’s current account deficit widened to £23.5 billion (3.2% of GDP) in Q1 2025, up from £21.0 billion in Q4 2024 and well above expectations of a £19.75 billion shortfall. It was the largest deficit since Q2 2024, driven primarily by a sharp deterioration in the primary income balance. The primary income deficit widened by £2.9 billion to £6.4 billion, as credits fell more than debits—receipts declined by £6.7 billion, while payments to foreign investors fell by £3.8 billion. Meanwhile, the services surplus narrowed by £1.4 billion to £47.8 billion, with services imports rising by £5.4 billion and outpacing a £4.0 billion increase in services exports. In contrast, the goods trade deficit shrank by £4.1 billion to £55.3 billion, largely due to a £6.2 billion increase in goods exports, while goods imports rose by £2.0 billion. The secondary income deficit also narrowed slightly, falling by £0.3 billion to £4.7 billion (0.6% of GDP), down from £5.0 billion (0.7% of GDP) in Q4 2024.