According to the Institute of Directors (IoD), firms in the UK saw an overall improvement in growth over the first quarter, suggesting the economy is faring better than expected.
The IoD surveyed over 900 firms and found that compared to expectations at the end of last year, March saw improved investment and hiring intentions, confidence and demand. Just two weeks ago, the Government’s Budget predicted falling output in the first quarter of this year.
The IoD’s chief economist, Kitty Ussher, said about the survey’s findings:
“The data coming from our members is strongly suggestive of growth across all sectors in recent weeks. In particular, the strengthening of order books since the end of last year points to an economy performing better in the first quarter than was anticipated as recently as the March budget.”
While 22% of participating firms reported weaker order books, 50% of them reported stronger ones. The IoD said this net increase in demand was seen across all sectors of the economy, including manufacturing and public-facing sectors. Ussher cautioned, however, that increased demand could mean it will take longer for inflation to reduce to the Bank of England’s 2% target. She pointed out that UK inflation has so far remained in double digits, compared to a recent drop to 6.9% from 8.5% in the Eurozone.
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