Member Article

Lowest confidence for 16 years

Earlier this week we reported on a survey which revealed that North East business owners were feeling confident about the current economic crisis, even suggesting that it was offering them new opportunities.

It seems that this attitude is not echoed across the country, unfortunately, as a survey from accountants BDO Stoy Hayward reveals that UK business confidence has fallen to its lowest level since 1992. The company’s Business Trends Report showed confidence about the next three months fell to 97.7 in June from 98.3 in May.

BDO said that the low business confidence figures would suggest that companies were expecting annualised economic growth of 1.3% in the next three months.

That would be less than the chancellor’s forecast of between 1.75% and 2.25% for 2008.

Peter Hemington, partner at BDO Stoy Hayward LLP, said: “We’ve not seen short term business confidence plunge this low since Black Wednesday in 1992, indicating that UK businesses of all shapes and sizes are struggling to see any light at the end of the tunnel.

“With confidence at a 16-year low, an interest rate rise next week aimed at curbing inflation could be crippling for business, and could worsen the effects of the economic slowdown. Our figures suggest that the MPC will be left with little choice next week other than to leave interest rates unchanged.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .