Exclusive interviews with leading policymakers that convey the true policy message that impacts markets.
Reporting on key macro data at the time of release.
Real-time insight on key fixed income and fx markets.
- Emerging MarketsEmerging Markets
Real-time insight of emerging markets in CEMEA, Asia and LatAm region
- MNI ResearchMNI Research
Actionable insight on monetary policy, balance sheet and inflation with focus on global issuance. Analysis on key political risk impacting the global markets.
- About Us
By Jai Lakhani
LONDON (MNI) - Here are five things we learned from the British Chambers of
Commerce first quarter survey.
- It is doubtful that UK economic expansion picked up significantly in the
first quarter compared to the fourth. In the dominant services sector, orders
and sales moved upwards, with the balance of firms reporting increased export
sales rising slightly to 13 from 12 in Q4 and the domestic orders balance
rising from 7 to 10.
- The previous good news story, of manufacturing exports rising due to a
combination of strong overseas growth and sterling weakness, still held good
with the proportion of firms reporting improved export sales standing at its
highest since Q2 2014. The Q1 export sales balance rose from 25 previously to
30. However, softer domestic demand weighed on this with domestic sales falling
from 23 to 17, the lowest since Q4 2016.
- The Bank of England Monetary Policy Committee's view at its March meeting
was that there is likely to be little to no slack in the economy. However
Wednesday's activity data for February's Industrial Production, construction,
manufacturing and trade showed a theme of fairly weak growth in industrial
production alongside weak and negative manufacturing and construction m/m growth
figures but an improvement in trade; in line with the BCC findings.
- The BCC survey added to the weight of evidence that employers are
struggling to fill job vacancies. That should put upward pressure on pay but it
could well also prove to be a brake on growth. This has plagued businesses for
the past few quarters and has not eased significantly with both services and
manufacturing struggling to recruit.
The percentage of services firms reporting increased recruitment
difficulties fell from 71% to 60%, with professional and managerial roles the
leadings areas of hiring difficulties (51%). Manufacturing tells a similar story
with increased difficulties in reporting down from 76% to 69%, still high by
historical standards with skilled manual labour having recruitment difficulties
of 68%- the highest level since inception.
- The political climate has favoured pushing down on net migration to the
UK, but the economic reality is that employers are struggling to fill vacancies,
with sterling weakness and the uncertainty surrounding Brexit reducing the UK's
pulling power. Business lobby groups, and the BCC is one such, will push for
more support from government.
"What growth we see in the UK economy is due principally to strong global
trading conditions, rather than domestic demand, which remains muted.
Uncertainty, recruitment difficulties, and price pressures remain consistent
concerns for businesses of every shape and size," Adam Marshall, Director
General of the BCC, said in a statement accompanying the data.
--MNI London Bureau; +44 203 865 3828; email: firstname.lastname@example.org
--MNI London Bureau; tel: +44 203-586-2223; email: email@example.com