The British Chambers of Commerce (BCC) has slightly upgraded its UK growth forecast for 2017 from 1.4 per cent to 1.5 per cent, even though growth over the next few years is forecast to remain “anaemic” and well below historical averages.
According to the BCC, one of the country’s largest business groups, the slightly upgraded growth forecast for 2017 can be attributed mainly to the stronger global outlook growth, including in key markets for UK businesses. The lower sterling is also likely to further boost short-term export activity this year, with growth expected to rise by 3.1 per cent in 2017, up from a forecast of 2.7 per cent three months ago. Manufacturing and construction in the UK are also projected to boost output in the coming years.
Meanwhile, higher inflation is likely to cause concern for UK businesses and consumers, hampering the UK’s shorter-term growth prospects. According to the BCC, inflation is expected to rise further over the course of this year as the increasing costs of imported raw materials continues to filter through supply chains.
Dr Adam Marshall, Director General of the British Chambers of Commerce, says: “Over recent months, many of the businesses I speak to have expressed cautious optimism for their own prospects, but remain wary about the growth prospects of the UK economy as a whole.
“The cost of doing business in the UK is too high – and weighs on the investment, recruitment and growth capabilities of our firms. Companies are faced with significant currency fluctuations and rising upfront costs, and their growth efforts are hampered by skills shortages.”
Click on the link to view the BCC Quarterly Economic Forecast – Q2 2017
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