Economy: Recovery continuing to gather pace, according to latest CBI Growth Indicator
Katja Hall, CBI chief policy director. - Credit: Archant
Economic growth continued to gather pace in April, alongside predictions of even stronger growth in the next quarter, according to the latest CBI Growth Indicator, out today.
Output rose from the eight-month low recorded in the previous month, and remains well above average, indicating that the UK’s economic recovery is steadily advancing.
Growth strengthened across the retail and service sectors, while manufacturing output growth remained solid.
The outlook for the next three months is exceptionally strong and broad-based, with growth expectations the strongest since the data began in 2003.
The survey of 675 respondents across manufacturing, retail and services recorded solid growth in activity, with a balance of +25%, up from +19% in March. Firms are optimistic that growth will pick up again over the next quarter, with the expectations balance at a record +42%.
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Katja Hall, CBI chief policy director, said: “These latest growth figures, and the strong expectations for the next quarter, provide further encouraging signs of increasing vigour and confidence across the UK economy.
“While consumer spending accounted for the lion’s share of GDP growth last year, there are firm indications of growth becoming more broad-based. It’s good to see that business investment has consistently contributed to quarterly growth since 2013.
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“We expect growth to strengthen in 2014, underpinned partly by rising business and consumer confidence and supportive monetary conditions. Productivity and earnings are also expected to start recovering this year.”
The CBI composite survey indicator, first published in January 2014, brings together CBI surveys of economic activity into an aggregate index. The indicator includes survey results for output volumes as reported on a monthly basis for the manufacturing, consumer, business & professional services, and sales volumes for the distribution sector. It offers an early perspective on the pace of economic growth and covers around 75% of the private sector economy.
The CBI Growth Indicator for April 2014 is a composite of the Industrial Trends Survey, Distributive Trades Survey and Service Sector Survey.
