UK July goods and services trade deficit narrows to £3.45bn

The headline beat matters less than the composition: a narrower deficit driven by both goods and services suggests the improvement is broad rather than a one-off swing in a single category. For sterling and UK rate expectations, the read-through is that external demand held up better than consensus assumed, which could soften the case for aggressive easing. Whether the revision to the prior month and the July beat mark the start of a trend or just monthly noise is the open question.