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14 December 2016

East of England business confidence remains weak, says ICAEW

Business confidence remains weak in the East of England according to the latest ICAEW Business Confidence Monitor (BCM). Business performance is constrained in the region, however companies anticipate some improvement in the year ahead.

Q4 2016 key findings:

· ICAEW's Business confidence Index in the East of England stands at -0.3, a drop from +13.1 recorded 12 months ago

· Input prices and average salaries have risen more rapidly (2.0% and 2.2% respectively) than selling prices

· Profits are up just 2.3% in the year, less than the 5.7% increase in the 12 months to Q4 2015

· Export sales growth is expected to accelerate to 5.2% as well as domestic sales and businesses anticipate selling prices will rise by 1.0% year on year

Phillippa Bourne, ICAEW East of England Director said:

"It is encouraging to see business confidence in the East of England has strengthened slightly compared to the previous quarter, however businesses in the region remain negative. One of the challenges for companies in the region is input prices and salaries rising more rapidly, therefore putting an increasing pressure on profit margins.

"Companies are looking ahead to 2017 with some optimism. This is likely to be aided by the more competitive exchange rate and new opportunities to export in the region. However, this is countered by imports becoming more expensive for UK business."

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