According to a business survey that was released on Sunday, British companies believe the doom that currently hangs over their prospects will continue in the near future.
In the three months ending in October, the Confederation of British Industry’s (CBI) gauge of private sector growth increased to -15 from -19 in the three months ending in September, remaining in contraction territory.
Although manufacturers were more upbeat, services and distribution businesses anticipate a further downturn over the next three months.
“Amid rising costs, labour shortages and demand waning, businesses foresee a continued fall in activity over the next three months.”
Paleja argued that in order to shake businesses out of their slump, it is crucial that new Prime Minister Rishi Sunak restore economic stability.
624 businesses responded to the CBI survey, which was conducted between September 26 and October 13.
On the other hand, in contrast to other, more pessimistic measures of the consumer economy, a business survey released on Thursday showed that British retail sales increased this month.
The monthly retail sales balance reported by the Confederation of British Industry, which primarily includes large retail chains, increased from -20 in September to +18 in October.
Other information, such as spending card data released on Thursday, painted a more negative picture.
“The reported sales balance likely was depressed in September by the additional public holiday for the Queen’s funeral, so it was always likely to rebound,” Samuel Tombs, chief UK economist at Pantheon Macroeconomics consultancy, said.
The CBI survey predicted that official sales volumes would also increase in October, despite the fact that the overall outlook for consumer confidence remained decidedly pessimistic.
The Office for National Statistics’ credit and debit card data revealed that spending decreased in the week leading up to October 20 to 97.5% of its pre-pandemic level in February 2020.
Consumer spending on this measure is 14% lower than it was prior to the pandemic after inflation adjustment, with a decline of nearly 30% for delayables.
The near-collapse of online furniture retailer Made.com on Wednesday highlighted the challenging environment for British retailers, which was valued at just over 2 million pounds on Thursday after going public with 775 million pounds last year.
According to a survey released earlier on Thursday, over two-thirds of British adults intend to reduce their holiday spending this year due to a worsening cost-of-living crisis.
According to the Accenture survey, even though two Christmases were spent with at least some social limitations brought on by the COVID-19 pandemic, three-quarters of adults do not have big celebrations planned.
(Adapted from Reuters.com)