It took a while, but finally, it seems that the combination of a competitive exchange rate and falling real incomes led to a long-awaited response from the trade. In February, the trade deficit fell to 2.44 billion pounds from 3.86 billion the previous month and 5.66 billion in December. Exports rose by 1.3% compared to the previous month in February, while imports fell by 2.2%. Over the past five months, exports jumped by about 10%, whereas imports by only 1%. Good trade news came despite the worsening balance of trade deficit by 0.5 billion pounds of oil. Given the grave state of consumer demand in recent weeks, it would be surprising if the import did not go weak in the next few months. During the quarter, "consumer hibernation, it seems that net exports will make a positive contribution to GDP growth in the first quarter.
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