Barometer says UK is emerging from the slump

Ben Southwood
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THE UK is emerging from recession, and will show its recovery with a strong third quarter GDP figure, an influential business survey claims today.

Sentiment in retail and other services soared in September, the data released this morning from Lloyds Bank shows, offsetting a slip in manufacturing optimism.

Business confidence in non-retail services grew for the third consecutive month, rising from a net balance of 11 to 15, while confidence in retail climbed from eight to 17, a five-month high.

“A big jump in manufacturing output in August, alongside continuing gains in employment support the rise in [confidence],” said Lloyds’ chief economist Trevor Williams.

Despite this fall in the probability of a recession, the headline business barometer stayed unchanged. Forty per cent of respondents were more optimistic than three months ago while 10 per cent were less optimistic.

The report to predicted a return to growth in the third quarter. “Headline third quarter GDP is likely to be strong due to an unwinding of the Diamond Jubilee effect,” the report forecasts.

Firms rated their own prospects above the prospects of the economy in general. Some 51 per cent of respondents predicted the future would be brighter than the present for their company, while only eight per cent disagreed.