Morale of British companies hits 18-month high
Large British companies saw a surge in morale in the fourth quarter of the year, as businesses shake off Brexit jitters.
According to the latest survey by Deloitte, morale amongst large British businesses hit an 18-month high. Economic growth continues to exceed expectations in the wake of Brexit, encouraging positive sentiment from large organisations.
“Buoyed by a backdrop of continued UK growth, CFOs have become markedly more positive on the outlook for their businesses and enter 2017 in better spirits than at any time in the last 18 months,” said Ian Stewart, Deloitte’s chief economist.
“However, rising optimism does not represent a return to business as usual.”
Deloitte also warned that investment spending remains weak, as Chief Financial Officers remain wary over the effects of next year’s Brexit negotiations. The survey found that only 21 percent of CFOs said now was a good time for their company to take risks, well below the average figure usually recorded.
House prices soar unexpectedly in December
Further positive economic news came from mortgage lender Nationwide, who recorded a soar in British house prices in December.
Annual prices rose 4.5 percent in December, up from 4.4 percent in November. Economists polled this month by Reuters had only expected to see growth of 3.8 percent.
However Howard Archer, chief UK and European economist at IHS Markit, commented:
“The fact that the housing market is seemingly struggling to build momentum after coming modestly off its August lows reinforces our suspicion that it is likely to find life increasingly difficult as 2017 progresses.”
Alongside the figures, Nationwide also warned that growth was likely to slow in 2017 to around 2 percent, a significant drop from December’s figure.
Shares in housebuilder Bovis Homes sunk on Wednesday after it decreased its profit forecast. A slow December meant that 180 sales would fail to complete before the year end, substantially hitting the balance books.