The UK’s goods trade deficit with the rest of the world widened in April to £7.3 billion from £7.2 billion in March, despite analyst predictions that it would narrow to £7.0 billion pounds.

Exports fell 0.6 per cent and importers fell by 0.4 per cent on the month, the first fall in exports since January’s weather related decline of 5.7 per cent.

Mark Bolsom, head of UK trading desk at Travelex, said, 'The financial markets have barely reacted to the news, despite it being the first fall in exports since January. We know the volcanic ash prevented goods coming in and out of the country and that stands apart from genuine economic activity. This disruption will have skewed the figures.

'Confidence may have been restored somewhat by a post-election honeymoon period for the new coalition government, as well as a weaker pound. Interestingly, the volcanic ash did not affect importers and exporters growing confidence in an export-led economic growth. From 42 per cent in March, 51 per cent of importers and exporters had confidence of this in May. This highlights the entrepreneurial spirit that UK importers and exporters have, despite ongoing economic turbulence.'

Sterling barely reacted to the news, gaining 0.13 per cent against the euro to 1.2089 and 0.35 per cent against the dollar, rising to $1.4451.