In recent months, the news for the economy has been largely positive, with many businesses reporting new growth and feeling optimistic about future job creation and expansions. However, the latest set of figures that have been released were not as encouraging.
New figures recently issued by the CBI show that growth slowed in the last three months to August. More than 700 businesses from the manufacturing, retail and services industry responded to the CBI survey; figures showed that growth in the manufacturing and businesses and professional services industries slowed in the last quarter. However, there was good news for the retail industry as figures indicated that sales volumes in the retail sector have remained strong.
However, it wasn’t all bad news for the manufacturing and services industries, as although growth had slowed, it is still remains at above average and the CBI growth indicator shows that UK businesses are positive about the next three months.
Businesses were looking forward to the next quarter; they expect the next three months to be “robust” and to reach near record levels.
Commenting in a press release, Rain Newton-Smith, CBI Director of Economics, said:
“There are a few early signs that momentum in the economy may ease slightly in the second half of the year.
“However, growth is set to remain robust, and there are positive signs that the recovery is continuing along the right track.
“Alongside the strong showing from the retail sector, it’s encouraging that firms feel particularly upbeat about growth prospects as we head into the autumn.
“Businesses will continue to keep a weather eye on developments overseas, as subdued prospects in the Eurozone and international political uncertainty make the global economic environment that bit more challenging.”
Despite the news of stalling growth, the CBI has issued a statement outlining its forecast for the rest of 2014 and it remains positive about future growth. The CBI stated that the UK recovery is on “sold ground” and said that it expected that the on-going recovery would remain on an “even keel” throughout the coming months.
However, the CBI warned that although business growth is performing better than expected, it has still to reach the pre-crisis levels of 2008. The CBI also urged politicians to keep their focus on building long-term economic security and not to just concentrate on “winning the political race”