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Business Confidence In UK At Four Year High In August, Finds Latest Survey

Business Confidence In UK At Four Year High In August, Finds Latest Survey
A recent survey showed business confidence in Britain has touched high that were last seen in April of 2017 as businesses banked on the hope of a strong economic rebound to pre-pandemic levels.
The latest Lloyds Bank Business Barometer found that the biggest jump in confidence was registered by employers in England's North West and East. However there was also some concerns about inflation and staff shortages
But greater optimism about the continuation of the economic recovery was expressed by companies in manufacturing, services and construction.
The monthly survey was conducted between 2 and 16 August and included 1,200 firms and revealed that there was a positive response for business confidence in Northern Ireland following a negative response in the survey of the previous month of July.
The overall business confidence among UK firms surged by six point to +36 per cent in August primarily because of improvements in trading prospects of companies and anticipation of a stronger growth in the year ahead.
"Business confidence reaching its highest level in over four years tells a positive story about the country's economic recovery. This confidence is driven by the continued success of the vaccine rollout, the removal of lockdown restrictions and adjustments to self-isolation rules,” said Said Hann-Ju Ho, senior economist at Lloyds Bank Commercial Banking..
"Staff shortages remain a challenge, but as the economy moves back towards pre-pandemic levels we can be optimistic that the momentum for business confidence and economic optimism can be sustained in the months ahead," Hann-Ju Ho added
Nine out of the 12 UK regions and nations in reported an increase in business confidence in August with notably strong confidence growth in the North West, which rose by 26 points to 64 per cent while there was a 14 point increase in business confidence among firms in East of England, to 39 per cent.
The rise in confidence was smaller in the North East, with a rise of 6 points to 46 per cent, and in London, rising by 4 points to 41 per cent. The confidence of businesses in the North West, East of England and North East, was the highest since the survey sample was expanded in 2018.
The recent official statistics of the government were echoed by the improved responses of the businesses. Indications from the data from the Office for National Statistics earlier this month about the jobs market suggested that there was continued robust rebound in the labour market.
And with furlough support ending and tax receipts rising, government borrowing also saw a decline.
However, like some of the other recent surveys, the Lloyds barometer also indicated that one of the areas of worry was inflation which slowed down suddenly in the year to July to 2 perc cent from 2.5 per cent in June.
"It is clear there is still some level of uncertainty on inflation and the impact of price pressures," said Gareth Oakley, managing director for business banking at Lloyds. "The last few months of the year will be pivotal to the future of UK economic growth.”

Christopher J. Mitchell

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