Robust economic growth and relatively low inflation are predicted for the next two years in the CBI’s latest quarterly report.
But the employers’ group still cautions concern over the balance of the economy. It expects consumers to spend more as export growth falls later this year. Rapid spending of windfall gains from building societies could push prices up. Manufacturing output is forecast to rise 2.3% this year and 2.9% in 1998.
Latest official figures show manufacturing output in Wales continuing to outstrip its performance in the rest of the UK. But growth in Welsh output in the year to the fourth quarter of 1996 was 0.3% lower than in the previous four quarters.
Mounting worries over the strength of the pound have hit long-term export confidence, according to the DHL quarterly export indicator. Exchange rates were cited by 67% of respondents as the factor most likely to hit sales. Raw material costs and overseas economic conditions were also seen as serious factors.
DHL’s research shows exporters increasingly welcoming a single currency, a figure rising to 58% in May, from 54% in November. Just over a quarter think that the pound’s participation would be unhelpful.