UK Balance of Payments - The Pink Book: 2025

5th November 2025

An annual review of cross-border transactions on the UK's balance of payments, including the current account, financial account, and the international investment stock position.

The UK's current account deficit moved to £63.2 billion, or 2.2% of gross domestic product (GDP) in 2024, narrowing both in cash terms and as a proportion of GDP; from a revised deficit of £98.3 billion (3.6% of GDP) in 2023.

The trade balance narrowed to a deficit of 0.9% of GDP in 2024, from a revised deficit of 1.2% of GDP in 2023.

The primary income account deficit narrowed to a deficit of 0.7% of GDP in 2024, from a revised deficit of 1.7% of GDP in 2023.

The rate of return on investment in the UK fell to 3.7% in 2024, and rate of return on investment abroad fell to 3.6%, as interest rates in the UK and abroad reduced.

The financial account recorded a net inflow of £64.1 billion (2.2% of GDP) in 2024, with net financial inflows of £418.9 billion (14.5% of GDP) and net financial outflows of £354.7 billion (12.3% of GDP).

The value of the UK's net international investment liability position at the end of 2024 was £145.6 billion (5.0% of GDP), compared with a revised £267.3 billion (9.7% of GDP) at the end of 2023; this was largely because of changes in equity and fund shares in both direct and portfolio investment.

Data for all periods have been open to revisions; revisions to the current account balance are because of incorporating methods improvements and updated trade, and foreign direct investment survey data.

The UK's current account deficit narrowed to 2.2% of gross domestic product (GDP) in 2024, from a revised deficit of 3.6% of GDP in 2023. In cash terms, this reduced the deficit to £63.2 billion in 2024 from £98.3 billion in 2023.

The trade balance moved to a deficit of 0.9% of GDP in 2024 from a revised deficit of 1.2% of GDP in 2023. The primary income balance narrowed to 0.7% of GDP in 2024 from 1.7% of GDP in 2023, as the direct investment surplus widened. The secondary income deficit narrowed slightly to a total deficit of 0.6% in 2024, from 0.7% of GDP in 2023.

The UK recorded the second largest current account deficit of the G7 (Group of Seven) economies in 2024, at 2.2% of nominal GDP. Germany recorded the highest current account surplus of 5.8% of its GDP, whereas the United States recorded the largest deficit in the G7, at 4.0% of GDP in 2024. The United States consistently ran a high trade in goods deficit accompanied by a low average savings ratio among its residents, whereas Germany and Japan had a much higher domestic savings ratio.

Trade
The UK trade balance narrowed to a deficit of £25.1 billion, which was 0.9% of gross domestic product (GDP) in 2024, from a deficit of £32.1 billion (1.2% of GDP) in 2023. The UK trade balance in 2024 reflected an expansion of the trade in services surplus, partially offset by a proportionally smaller widening in the trade in goods deficit.

Trade in goods
The trade in goods deficit widened to 7.3% (£210.7 billion) in 2024, from 7.0% of GDP (£192.1 billion) in 2023. This is partly because of a switch in the balance of unspecified goods (including precious metals and non-monetary gold) from a surplus to a deficit. Non-monetary gold is highly volatile and can distort trade trends.

There were other noteworthy contributors to the widening of the goods deficit. These included a:

£5.0 billion increase in the semi-manufactured goods deficit, to £27.1 billion

£3.7 billion increase in the oil deficit, to £24.3 billion

£3.3 billion expansion in the food, beverages and tobacco deficit, to £38.2 billion

These were partially offset by decreases in:

finished manufactured goods deficit, which decreased by £6.7 billion to £99.8 billion

coal, gas and electricity deficit (fuels other than oil), which decreased by £4.4 billion to £13.0 billion.

The trade in goods deficit in 2024 was attributed to a fall in the value of goods exports compared with 2023. Total goods exports decreased by £30.8 billion over the year to £386.5 billion. The largest decreases were recorded in:

unspecified goods, which fell to £6.3 billion in 2024 from £18.3 billion in 2023

semi-manufactured goods, which decreased by £7.0 billion to £105.9 billion

oil, which fell by £6.6 billion to £27.6 billion, as crude oil prices continued to decrease following record highs during the 2022 energy crisis

fuels other than oil, which decreased by £3.2 billion to £4.8 billion, reflecting lower gas and electricity prices

Imports of goods decreased by a lesser extent in 2024, by £12.3 billion to £597.2 billion. The largest falls were recorded in:

finished manufactured goods, which fell by £9.1 billion to £302.2 billion

fuels other than oil, which decreased by £7.6 billion to £17.8 billion

oil, which fell by £2.9 billion to £51.9 billion

These decreases were partly offset by:

increases in imports of unspecified goods, which rose from £3.3 billion to £9.5 billion

imports of food, beverages and tobacco, which increased by £3.6 billion amid higher UK food prices during the year.

Trade in services
The trade in services surplus widened to 6.4% of GDP (£185.5 billion) in 2024, from 5.8% of GDP (£160.0 billion) in 2023. Exports of services increased from £460.9 billion to £507.0 billion, and imports increased from £301.0 billion to £321.5 billion.

The trade in services surplus widened in 2024, as total services exports increased by £46.1 billion to £507.0 billion. The largest increases were recorded in:

intellectual property (by £13.5 billion)

other business services (by £12.7 billion)

travel services (by £6.6 billion)

financial services (by £5.3 billion)

Total services imports increased by £20.6 billion to £321.5 billion and the largest increases were in:

other business services (£11.8 billion)

telecommunications, computer and information services (£2.5 billion)

insurance and pension services (£2.2 billion)

Direct investment
Net foreign direct investment (FDI) earnings have remained positive annually since 2021. In 2024, the UK's net FDI income surplus increased to £52.1 billion, following a reduction in 2023. This is mainly because of a sharper fall in FDI debits (£137.9 billion to £80.4 billion) than credits (£171.6 billion to £132.5 billion) in 2024.

Non-residents earned £65.5 billion less from earnings on their UK equity investments, down nearly a half from £121.8 billion in 2023. This was largely because of a £41.6 billion decrease in dividends paid during 2024, to a total of £69.0 billion. These effects were partially offset by UK residents who received lower overseas investment income, with credits falling to £132.5 billion, including £50.1 billion less in equity earnings and £22.7 billion less in dividends. Credits were down £39.0 billion from 2023.

The private non-financial corporation sector was the main sector involved in direct investment income transactions, accounting for £37.6 billion less in credit-side earnings and £51.3 billion less in debits.

Portfolio investment
The narrowing of the net portfolio investment deficit in 2024 was largely from an increase in earnings of £7.0 billion paid out on debt securities to UK residents with foreign portfolio investment holdings. This included a £4.2 billion increase in payouts by foreign monetary financial institutions. There was also increased earnings on equity and investment fund shares of £2.5 billion for UK residents.

Rate of return
The rate of return reflects how much income is produced from a stock of external investment that is held by UK and non-resident investors. The rate of return is influenced by economic and financial factors, such as changes in interest rates.

In 2024, UK investors saw a decrease in the rate of return on their overseas investments abroad (assets) from 3.8% in 2023 to 3.6% in 2024. Non-residents saw a larger decrease in their rate of return in the UK (liabilities) from 4.2% to 3.7%. In 2023, the rates of return for both UK investors abroad and non-resident investors in the UK were at their highest point since 2008. The reduction in rates of return for assets and liabilities in 2024 occurred as the Bank of England and foreign central banks lowered interest rates in 2024.

Read the full report HERE