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UK firms' sales and optimism soar in third quarter - BCC
October 7, 2013 / 11:13 PM / 4 years ago

UK firms' sales and optimism soar in third quarter - BCC

By Joshua Franklin
    LONDON, Oct 8 (Reuters) - British firms recorded the best
growth in domestic trade for at least six years in the third
quarter and confidence is also rising sharply, a survey showed
on Tuesday.
    The British Chambers of Commerce (BCC) said the results of
its quarterly economic survey - Britain's largest major business
poll - suggested that national output growth sped up to around
0.9-1 percent in the July-September period.
    Service firms' domestic sales and orders rose at the fastest
pace since 2007, while the increases for factories were the
sharpest since at least the early 1990s.
    Expectations that profitability will improve in the next 12
months are now stronger than at any point since 2007 among
service providers and since 1994 among manufacturers.
    "It's clear that the UK upturn is gathering momentum, with
most key balances in this quarter higher than their
pre-recession levels in 2007," said David Kern, chief economist
at the BCC.
    As a result, the BCC was likely to revise up its forecasts
for Britain's gross domestic product in 2013 nad 2014, he added.
In August, the group predicted economic growth of 1.3 percent
this year and 2.2 percent next year.
    Prospects for employment, which will affect the timing of
the first rise in Britain's interest rates, also brightened.
    A balance of 26 percent of service firm planned to increase
headcount in the next three months - the highest reading since
2007.
    The same measure came in at 29 percent for manufacturers,
which is the highest since the survey began in 1989.
    The Bank of England has announced that it will not consider
raising borrowing costs from their record-low level until
unemployment falls to 7 percent.
    The official jobless rate now stands at 7.7 percent.
    The BCC said expansion in British business would continue
but probably at a slower pace, noting risks from a government
shutdown in the United States, its possible debt default and an
expected reduction in monetary stimulus for the U.S. economy.
    Moreover, the British government's deficit-cutting drive and
Britons' falling living standards "will inevitably act as a
constraint on growth in the next few years", the BCC added. 
    For a table of key findings, click

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