Business Confidence Hits 10 Year HighAug 28, 2017
Business confidence in the UK is at its highest level in the last 10 years, according to the Confederation of British Industry (CBI).
The news comes as the UK economy is set to grow faster than any other Western economy, as disclosed by the Institute of Chartered Accountants in England and Wales (ICAEW) this week.
According to a recent evaluation by the CBI, there is a strong economic pick-up in growth in the UK, supported by a predicted growth of 1.4% for this year. Production output was 2.2% higher in September 2013 compared with September 2012 according to the Office for National Statistics, offering credibility to claims by the CBI of a “slow and steady” economic recovery.
HSBC has also this week announced a profit surge of 30% in the three months to the end of September. Pre-tax profit for the bank was reported at £2.8bn and the bank cited “reasons for optimism with some evidence of a broadening recovery” in response to their figures.
The Co-Operative bank, who have now revealed their rescue plan (after the discovery of a £1.5bn hole in its balance sheet, caused by bad loans and the 2009 merger with Britannia building society) which will see the Co-op retain just 30% of shares in the bank, announced plans earlier in the week to reduce its branch network by at least 15% by the end of 2014. While the plans are set to enhance the bank’s internet and mobile services, there will be significant job losses as a result of the decision.
Group executive of Co-Op bank Euan Sutherland commented to the BBC “We do need to take the overall costs down, unfortunately [that] will hit jobs”. Sutherland also added that he was “optimistic” about the future, stating “We have taken a major step forward towards achieving our plan to secure the future of the bank”.
While there are encouraging signs of recovery for the UK economy in the statistics released this week, the news that Co-op is likely to cut jobs while losing control of its banking arm remains to remind us of the fragility of the UK banking sector.
Several UK banks are currently being investigated for currency trading manipulation including HSBC, Barclays, RBS, Citigroup, Deutsche Bank and UBS all of whom have confirmed contact with the Financial Conduct Authority (FCA) regarding their potential role in the latest banking scandal.
Despite claims of “optimism” in the future of the UK economy as well as promising statistics in production output and business confidence released this week, it’s difficult to forget the LIBOR rigging, mis-selling of PPI, money laundering and now tax manipulation scandals which remain to hinder the confidence of consumers all over the country.
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