Brexit UK Vulnerable As Gold Bar Exports Distort UK Trade Figures

– Brexit UK vulnerable as gold bar exports distort UK trade figures
– Britain’s gold exports worth more than any other physical export
– Gold accounted for more than one in ten pounds of UK exports in July 2017
– UK’s stock of wealth has collapsed from a surplus of £469bn to a net deficit of £22bn – ONS error
– Brexiteers argue majority of trade is outside EU, this is due to large London gold exports
– Single gold bar (London Good Delivery) is, at today’s prices, worth just over £400,000
– “There are few things you’ll ever touch which pack so much weight into such a small size”
– UK’s economic vulnerability means safe haven gold essential protection

I’ve never played poker but I’m pretty sure the number one rule is not to reveal your cards to your opponents.

Yesterday the ONS possibly gave the EU one of the biggest reveals so far in Brexit negotiations. Revised figures from the statistics bureau showed the country’s stock of wealth has fallen from a surplus of £469 billion to a net deficit of £22 billion as reported by LBC.

This is down to FDI and fall in reserve foreign assets. In the first half of the year FDI fell from a £120 billion surplus in the first half of 2016 to a £25 billion deficit for the first half of this year.

With the UK totally losing its foreign assets, the EU (and the rest of the world) is aware that its safety net is no longer there. Not great timing, just as the government is trying to get through this crucial stage of Brexit negotiations.

The amount that has been knocked off the UK’s wealth is the equivalent of 40% of EU contributions. The bank balance isn’t the only thing the UK has at best misunderstood or at worst been mislead over. Their trade is not as internationally diverse as Brexiteers might have led markets to believe.

Following the referendum result there was an increase in Britain’s exports. Many pointed to the numbers as a sign of confidence in the future of the UK, following the Brexit vote.

It turns out that much maligned gold was to thank for this uptick. Without gold, the majority of the UK’s trade would be with the EU.

This is a reminder of how vulnerable we are to negotiations and reliant we are on the precious metal.