UK Companies Continuing to Show Optimism
Despite the UK Economy entering a double-dip recession optimism amongst UK companies remains high according to two new surveys.
Business group CBI have said that there has been an increase in optimism from smaller manufacturers for the first time since mid 2011 while UK Business Confidence Monitor reported that confidence had improved over the past three months and also suggested a return to growth in quarter 2 of 2012.
The previous two quarters saw the UK economy shrink which means a return to recession. However, the CBI have said that a net 22% of small and medium-sized enterprises (SMEs) who are listed as manufacturers had a greater degree of optimism than in the three months to April.
Lucy Armstrong, chair of the CBI’s SME council said:
“Firms expect orders and output to rise strongly in the coming quarter and plan to invest more in the year ahead, pointing to growing momentum in manufacturing activity.”
The CBI also reported that a large proportion of those who responded witnessed a small increase in the amount of new orders and expected further increases over the coming quarter.
Meanwhile, the latest UK Business Confidence Monitor from chartered accountants ICAEW and consultants Grant Thornton said that they saw increased confidence.
The BCM confidence index is 12, up from -9.3 in the last quarter and the highest level since the second quarter of 2011. This increase implies economic growth of 0.6% in the second quarter, the organisations said.
Grant Thornton chief executive Scott Barnes said:
“Turnover and profits are all increasing but nowhere near the rate seen pre-recession and businesses are beginning to realise that this environment may be the norm for some time.”