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UK businesses predict a year of success |
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UK businesses are in an optimistic mood with many predicting an increase in economic activity over the coming 12 months, according to a survey of business confidence.
According to the accounting firm BDO Stoy Hayward, economic growth is forecast to see a significant rise during the second half of 2006 to reach 3.4 per cent, up from the 2.4 per cent recorded at the end of last year. Its survey of business trends found that a recovery of consumer spending, an economic upturn in Europe and the strong performance of the stock market have boosted consumer confidence and outweighed other negative factors such as rising fuel costs. The service sector was found to be the driving force behind economic growth in the UK, although the manufacturing sector was said to have a "respectable" increase in output. "Businesses are responding by planning for better times ahead - stocks are being built up and capital expenditure looks set to rise in the coming months," said Peter Hemington, a partner at the accounting firm.
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