Survey suggests recession is over

The latest ICAEW UK Business Confidence Monitor shows that confidence among business professionals is positive for the first time in two years.

The rise in confidence from -28.2 to +4.8 is the highest since Q3, 2007 and the ICAEW predicts GDP will rise 0.5 per cent this quarter based on the survey’s outlook.

According to the ICAEW (Institute of Chartered Accountants in England and Wales), this quarter’s change is the largest quarterly improvement seen since BCM began. This cautious optimism is underpinned by expected rises over the next 12 months in 13 out of the 14 financial performance indicators detailed within the BCM. This is in contrast to the picture earlier in the year when the majority were expected to contract.

‘This quarter’s BCM suggests that the UK recession is at an end,’ said Michael Izza, chief executive of the ICAEW. ‘While there is no doubt that the UK economy is on its way to recovery, we shouldn’t underestimate the challenges ahead for businesses. Businesses have taken the right actions to mitigate the impact of the downturn and are playing their part in an improving economy. Policies such as quantitative easing, the fall in interest rates and the VAT reduction have all helped improve business confidence. However, the recovery is very fragile and I would urge policy makers not to take any actions that could derail it.’