UK’s firms at most bullish in over a decade

BRITISH firms are at their most confident for the near future in over 10 years, according to a survey released today, and ahead of 2014’s first growth figures later this week.

The latest report from the Confederation of British Industry (CBI) shows businesses betting that growth will continue to pick up in the next quarter outnumber firms that think there will be a decline by 42 percentage points. The figure is the highest on record for the CBI, which has been asking the question of companies since 2003.

The net balance of firms that think their output has improved in the past three months was 25 per cent this month, up from 19 per cent in March and the 12th consecutive month in which growth has been suggested.

The initial figures for GDP growth in the first quarter are released tomorrow, providing the earliest sign from the Office for National Statistics of just how strong the recovery has been in 2014 so far.

Samuel Tombs of Capital Economics is expecting growth of 0.9 per cent, while Howard Archer of IHS Global Insight forecasts a 0.8 per cent expansion. Either would be higher than the 0.7 per cent boost in the final three months of 2013, and make the UK’s return to record GDP levels likely in the second quarter.

“We expect all sectors of the economy to have contributed to GDP growth in the first quarter of 2014, led by the dominant services sector. Even construction output is likely to have clearly expanded overall despite being handicapped by February’s floods,” added Archer.