According to new study
UK firms holding on to British bulldog spirit despite lack of certainty, the ICAEW has said.
Business confidence remains static and in negative territory according to the latest ICAEW UK Business Confidence Monitor (BCM). Although business uncertainty has been reflected by low confidence, the data shows that businesses are getting on with the job at hand and seeking to position themselves within a new post-Brexit economic landscape. This creates the perfect platform for Government to build from, by ensuring that the UK’s deal with the EU is the best fit for all businesses.
Here are the key findings:
The BCM Confidence Index is still in negative territory at -8.7 this quarter, compared to – 9.8 in Q4 2016
Companies forecast stronger growth in both domestic and export sales than in recent quarters. But with input costs rising, they are not anticipating that to translate into faster growth in profits
Capital investment has experienced the slowest growth for 3 years and expectations are slower yet in 2017
Research & Development spending is growing only moderately, as has been largely true since 2011
Stephen Ibbotson, ICAEW director of business, said: “It’s encouraging that business confidence hasn’t dropped further into negative territory following a difficult 2016. Inflation continues to rise and commodity prices are increasing more rapidly than before, so we expect costs to climb faster still. Firms will try to pass many of these increases on to their customers, which means that 2017 is likely to be a year of counting the pounds and pennies for consumers following an unsustainable spending spree towards the end of last year. In order for businesses to start the New Year off confidently, the Government should resolve the ‘Hard Brexit vs Soft Brexit’ debate in Parliament as quickly as possible and negotiate the most inclusive Brexit deal for business of all shapes and sizes across the UK.”