By Karen Dury and Laura Piscitelli of the Bank's International Economic Analysis Division, Maria Sebastia-Barriel of the Bank's Structural Economic Analysis Division and Tony Yates of the Bank's Monetary Assessment and Strategy Division.
The UK terms of trade rose by 15% from 1995 Q3 to 2003 Q1. This article looks at alternative explanations of why this happened, and what they mean for the likelihood that the terms of trade increase will endure.
What caused the rise in the UK terms of trade?