BDO LLP: 'UK business output in major despair for the first time in 2019'
A new report by BDO LLP reveals that UK business output growth has declined for the first time this year.
BDO’s Output Index, which measures UK business output growth, fell to 98.63 in April from 98.74 in March.
Business confidence also registered another decline in April, slipping by 0.36 points to 95.74 - the lowest level the index has reportedly been since 2012.
Commenting on the findings, Peter Hemington, partner at BDO LLP, said: “The only certainty businesses have at the moment is that the UK government still doesn’t know exactly how or when the UK will leave the European Union.
“We are seeing the impact of this confusion, with business confidence plummeting.”
It is somewhat true that the imminent threat of a no-deal Brexit was lifted last month. Because of this, activity in the manufacturing sector is expected to diminish due to unprecedented levels of stockpiling tailing off.
The manufacturing industry’s confidence has also supposedly hit a record low. BDO’s Manufacturing Optimism Index, which shows how businesses expect output to develop in the next three to six months, declined to 101.09 in April from 103.73 in March.
The index has not been this low since November 2016 and reflects concerns by manufacturers that they expect growth to moderate in the coming months.
Peter concluded: “An extension of Article 50 alone is insufficient to restore sentiment among businesses.
“In the coming months, the government should look at further policy interventions, such as increasing the Annual Investment Allowance, to help businesses invest and stimulate the UK economy.”
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