Britain's trade gap hit a record level in November as exports tumbled.

Slowing overseas demand pushed the goods deficit to almost £4 billion, far higher than expected in the City.

Analysts had expected the gap to narrow from October's previous record of £3.6 billion and were stunned by the rise.

The Office for National Statistics (ONS) reported in the three months to November exports to the United States fell by £600 million.

Philip Shaw, chief economist of Investec, said: "This is symptomatic of the slowdown in world trade caused by the slowing world economy."

Given a services surplus of £1.2 billion in November, the overall trade deficit for the month widened to £2.8 billion.

Manufacturers have suffered a torrid year, with thousands of staff laid off as the economy catches the chill from the global downturn.

In recent months, the main fall in demand has come from the euro zone but the ONS said November's gap was caused by trade with non-EU countries.

While goods exports to the EU member states in the month were flat, exports to the rest of the world plummeted 13 per cent.

Ross Walker, economist at Royal Bank of Scotland, said: "This grim news means the weakness may now be fairly broadly based."

The goods deficit was now likely to be £35 billion for 2002, or 3.5 per cent of gross domestic product, the highest percentage since the late Eighties.

Shadow trade secretary Tim Yeo said the £4 billion figure highlighted the imbalances in the UK economy. He said: "These trade figures are another damaging addition to this Government's downgraded economic reputation.

"Sadly a Government which daily adds to the burdens on business and erodes our competitive position shows no sign of either heeding the danger or tackling its causes."

Analysts believe interest rate cuts by the European Central Bank and the US Federal Reserve before Christmas could bolster demand for UK goods.