Food and drink exports have surged to their highest point on record at the start of the year, as the “sweet spot” for British exporters continues.
Exports of all UK food and drink in the first quarter of 2017 grew to £4.9bn, up 8.3 per cent compared to the same period in 2016, according to the Food and Drink Federation (FDF), an industry body.
South Korean beer drinkers were one of the biggest drivers of growth. Exports jumped by 40.3 per cent to the Asian nation, ahead of growth in exports to Belgium’s 37.3 per cent.
Exporters have been enjoying a “sweet spot” in recent months, according to the Bank of England’s deputy governor Ben Broadbent, as the depreciation of sterling boosts the attractiveness of UK products for foreign buyers but there is no change to trading arrangements.
However, across the economy as a whole business confidence has plummeted in the run-up to the General Election, despite the outlook on Britain’s economy holding up, a new survey shows.
Confidence in business prospects plunged by 34 points in May, with a balance of only 26 per cent of firms reporting an improvement in their own outlook, according to the Lloyds Bank survey.
The fall in confidence this month comes after a surge in April which saw the highest balance of businesses reporting better prospects in almost a month and a half.
Resilient consumer spending in the second half of 2016 and a delayed pass-through of the decline in the value of sterling ensured business confidence bounced back from its lowest levels in more than four years after the EU referendum.
However, government figures showed the British economy slowed to growth of only 0.2 per cent in the first quarter of the year, raising fears that the business environment may become more challenging.
The net balance of businesses with a positive outlook on the economy fell back by six points to reach 28 per cent.
The consumer sector is expected to be on the front line in particular, as consumers feel their disposable incomes squeezed by rising prices. Confidence in the consumer services industry dipped by six points, while business services confidence fell by 12 points.
However, despite the dip the economic outlook remains relatively healthy and above the long-term average of 20 per cent.
Hann-Ju Ho, senior economist for Lloyds Bank Commercial Banking, said: “Although we have seen a drop in overall business confidence from last month’s elevated level, it is only slightly below the long-term average.
“The June survey will provide a more complete picture for the quarter, but the results from our survey so far still point to a pickup in growth after the 0.2 per cent outturn in the first quarter.”