BRITAIN'S trade deficit narrowed in December to its smallest since July 2012, but manufacturing growth was weaker than expected, Office for National Statistics (ONS) figures show.

An increase in oil, chemical and aircraft exports helped the trade deficit in goods to fall by more than £2bn to £7.72bn, the ONS said.

Fewer imports of aircraft and ships also boosted the figures, it said.

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Manufacturing output rose by 0.3 per cent in December, less than the 0.6 per cent predicted.

The wider measure of industrial output rose by 0.4 per cent in the month.

However, the ONS said the weaker-than-expected growth was not enough to change the estimate of GDP growth in the fourth quarter of 2013, which was 0.7 per cent.

When services were included, the overall trade deficit narrowed to £1bn in December. This was down from a deficit of £3.6bn the month earlier and also the smallest deficit since July 2012.

Andy Tuscher, the North's regional director at EEF, the manufacturers’ organisation, said: “Manufacturers had a strong finish to 2013, but more encouraging, are the indicators we’ve seen since the start of the year which suggest that positive trend has rolled into the early part of 2014. Our expectation is that we see another quarter of 0.6 per cent expansion in the three months to March, with a pretty even picture across sectors.

“The business surveys have been pointing to a decent picked up in the home market, but the trade data today shows the export story has yet to follow. However, with more confidence that export demand will gather pace through the course of this year, we should expect the official data to follow suit.”