Thursday, April 25, 2019
Home Business Business confidence 'at the lowest level since 2009' - ICAEW

Business confidence 'at the lowest level since 2009' – ICAEW

A "paint of progress" in Brexit negotiations is being blamed for a measure of business confidence falling to its lowest level since post-crash 2009.

The ICAEW has seen a sharp drop-off nationwide though FTSE 350 firms were said to be more pessimistic than privately-owned companies.

It was that particular weakness in capital investment.

The Reading for the fourth quarter, the ICAEW said, followed by the humbling Salzburg summit for the Prime Minister in which Brexit stance was branded "uncompromising" by the EU – raising fears of a "no-deal" scenario.

As the mood music has since improved, there has been growing evidence of exasperation at the pace of negotiations as the clock ticks down to next March when the UK is due to leave.

IHS Markit (Stuttgart: A1139A – news) / CIPS Purchasing Managers Index (PMI) activity indicators.

The report covering the manufacturing sector at its lowest level since July 2016 – the month after the EU vote.

The survey covering the powerhouse services sector did not come to an end in the final quarter of the year.

Its data, covering October and released on Monday, showed activity at a seven-month low with firms at their most gloomy on the outlook since July 2016.

In addition to Brexit uncertainty firms, cited the US / China trade, slowing global growth and financial market turbulence for the cautious approach.

The Bank of England used its inflation report to say it could predict 0.3% in the final three months of 2018 – down from a forecast.

Chris Williamson, chief business economist at IHS Markit, said: "The survey data suggest that, despite slowing down, the service sector is on course to provide the main impetus to economic growth in the fourth quarter, working at a rate of just 0.2% if current levels are maintained (around half the pace seen in the third quarter).

"In contrast, at current levels, manufacturing is only a drag on the economy in the fourth quarter with construction making only a small contribution to GDP."

Sharon Gunn, ICAEW's executive director, said: "Leaving the EU and its potential impact is at the forefront of everyone's minds.

The UK economy desperately needs post Brexit to drive growth.

Government provides stability and reassurance. "


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