HC Deb 01 December 1986 vol 106 cc433-4W
Mr. Robin Cook

asked the Secretary of State for Trade and Industry to what factors he attributes the increase in the invisibles trade surplus in the month of October; and whether there have been any changes in methodology or statistical assumption in the calculation of the invisibles balance.

Mr. Alan Clark

The projection of the invisible balance for October is based on the same methodolgy as previous figures prepared at this stage of the quarterly cycle of balance of payments statistics. It reflects the latest evidence on trends in the main components of the invisible account available up to the middle of November on interest and exchange rate movements since the third quarter. It is rounded to the nearest £100 million to emphasise its approximate nature.

Mr. Robin Cook

asked the Secretary of State for Trade and Industry if he will state the basis for the upward revision of the invisibles balance for the months of July, August and September; when was the last occasion on which the balance for the previous quarter was revised upward by one third; and whether there has been any previous occasion on which the projected monthly figures for the invisibles balance were revised in advance of the estimate for the full quarter.

Mr. Alan Clark

The revision to the monthly figures for July, August and September was based on the latest assessment of the main credit and debit flows in the invisible account in the third quarter based on information received from surveys of firms' overseas transactions, returns from financial institutions, etc by the middle of November.

The projected balance has frequently been revised upwards or downwards by £100 million when firm information becomes available, and in the third quarter of 1984 the initial projection of £250 million was later revised to £455 million.

The current practice is not to revise the quarterly projection until the quarterly figures are published in the full balance of payments accounts unless there is strong evidence that a substantial revision is required.

For the previous quarters of 1986, the indications were that the actual quarterly figures were reasonably close to the projection, allowing for rounding, but for the third quarter a significantly higher level was indicated.