UK business confidence improving

Business Trends: BDO

  • Business conditions continued to improve in September, as the Output Index increased to 99.5, up from 98.3 the previous month. The last time the index was higher was in July 2010.
  • The Optimism Index reached 100.7 in September, up from 98.0 in August. This level of confidence has not been seen mid-2010
  • Overall inflation expectations for business input prices continued to come down
  • Hiring expectations improved modestly

Indicators looking up

Business Trends: BDO

  • The Optimism Index, which predicts business performance in two quarters time, increased for the eighth consecutive month – from 98.0 in August to 100.7 in September, its highest level since April 2010. The figure has risen beyond the 100.0 mark, the level at which the economy is expected to achieve its long-run average trend growth rate over the coming six months, suggesting that economic growth will pick up speed in the next two quarters.
  • The Output Index, which predicts short-run turnover expectations, also continued its upward trend this month, reaching a 30-month high of 99.5 in September, up from 98.3 in August.
  • The Inflation Index, which predicts short-run business cost inflationary pressures, recorded a fifth consecutive decline to 100.6 in September from 101.0 in August.

Business trends positive

Business Trends: BDO

  • The Output Index climbed to a 26-month high of 96.8 in July up from 94.9 in June – a fifth consecutive monthly increase
  • Output in the services sector, which makes up roughly three quarters of the UK economy, rose from 94.7 in June to 96.5 in July
  • The manufacturing sector rose from 95.7 in June to 98.3 in July
  • The Optimism Index, which predicts business performance in two quarters time, moved up from 94.3 in June to 95.6 in July, posting its sixth consecutive monthly increase and standing at its highest level since April 2012
  • The Employment Index has continued to move upwards, increasing to 97.0 from 96.7 in June
  • The Inflation Index (overall inflation expectations) decreased to 102.2 in July, down from 103.4 in June

Business confidence up to 13-month high

Business Trends: BDO

  • The Optimism Index, which predicts business performance two quarters ahead, moved up for the fifth consecutive month from 93.6 to 94.3, a 13-month high
  • The Output Index, which predicts short-run turnover expectations, increased for the fourth consecutive month to 94.9 in June from 94.4 in May
  • The Inflation Index decreased from 104.2 to 103.4, thus easing financial pressures on UK businesses.

UK business confidence improves

UK business confidence improves: BDO

  • Output and Optimism indices moved up to 94.1 and 93.0 respectively
  • Service sector confidence moved up substantially in April
  • Services Optimism Index, which predicts business performance two quarters ahead, also went up, increasing to 94.1
  • Output Index for manufacturing fell this month from 92.4 to 90.8
  • Optimism Index for manufacturing moved up to 88.3

SME orders and output fall

SME Trends: CBI

  • Small and medium-sized manufacturers saw orders and output continue to fall in the three months to April, though firms are expecting both to grow in the next quarter.
  • Output also fell for the fourth consecutive quarter. However, manufacturers expect output to grow slightly over the next three months.
  • Optimism about the overall business situation has steadied, following three quarters of decline. Meanwhile, optimism about export prospects rose for the first time in a year.
  • Manufacturers expect a modest increase in headcount in the coming quarter.
  • Growth in average unit costs was the fastest since October 2011, squeezing manufacturers’ profit margins once again.
  • No sign of an improvement in credit conditions

Business confidence improving

Business confidence improving: BDO

  • The Optimism Index increased by 1.7 points this month following its 21-year low reading in January. The Index increased to 90.6 in February from a reading of 88.9 in January – the biggest increase in the index for five months.
  • Despite this increase, businesses still do not anticipate growth in the next two quarters
  • The Inflation Index increased from 100.4 in January to 101.5 in February, its highest level since September 2012.
  • The Output Index saw a decrease from 92.3 last month to 92.1 this month