UK business optimism hits all-time high

Optimism among firms reached its highest level in more than two decades in January, according to the Business Trends report by accountants and business advisers BDO

Spending chiefs have urged the creation of a new £200m fund to help SMEs
Optimism among firms reached its highest level in more than two decades in January

Optimism among firms reached its highest level in more than two decades in January, according to the Business Trends report by accountants and business advisers BDO.

The BDO optimism index, which predicts performance two quarters ahead, reached 103.8 in January, up from 103.4 in December.

It is the highest reading since the index began 22 years ago and well above the 100 mark, indicating the UK is expected to outperform long-term growth trends.

Optimism in the manufacturing industry was at an all-time high, while outlook for the dominant services sector also looked rosier, and overall hiring expectations were up too, indicating better-than-usual job creation over coming months.

BDO partner Peter Hemington said: “UK business confidence has hit record highs as we enter 2014 and we expect the economy to grow rapidly in the first half of the year.”

Meanwhile, the Lloyds Bank commercial banking regional Purchasing Managers’ Index found business activity across the English regions at a seven-month low, though still indicating strong growth.

The reading of 59.1 was down from 60 in December, but it remained above the 50 mark signalling growth for the 15th consecutive month.

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