Confidence among firms in the East ‘at its lowest since 2009’, ICAEW report shows

Phillippa Bourne, East of England regional director for the Institute of Chartered Accountants in En

Phillippa Bourne, East of England regional director for the Institute of Chartered Accountants in England and Wales - Credit: Archant

Business confidence in the East of England has fallen to its lowest level for nearly eight years, according to a new survey.

But business leaders in the region are more hopeful of some improvement over the next 12 months, the Institue of Chartered Accountants in England and Wales (ICAEW) Business Confidence Monitor shows.

The new index reading of minus 17.9 is the lowest since the second quarter of 2009, with 57% of businesses in the regional working below capacity.

However, export sales growth is expected to accelerate from 1.7% over the last 12 months to 3.4% in the year ahead and domestic sales are also anticipated to be stronger, with growth of around 4.3% compared with 3.8% in the past year.

Input prices meanwhile are expected to continue rising at 2.4%, broadly in line with the increases seen in the year to date.

Phillippa Bourne, ICAEW East of England director, said: “It is a concern that business confidence in the East of England has dipped again this quarter. Inflation continues to rise and commodity prices are increasing more rapidly than before, so we expect input prices to continue growing.

“Businesses are likely to pass some of these increases on to their customers which means that 2017 is likely to be a year of counting the pounds and pennies for consumers in the East of England.

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“On a more positive note, sales expectations remain robust, possibly due to the post-Brexit world proving better than some worst case scenarios predicted.

“In order for businesses in the region to start building confidence, Government should focus on negotiating the most inclusive Brexit deal for business of all shapes and sizes across the UK.”