UK Chamber of Commerce Survey Shows 2016 Will be Tough for Manufacturing

Manufacturing exports slumped at the end of last year, and will continue to suffer in 2016, leaving Britain with a two tier economy that relies on consumer spending to drive growth, a leading business group has warned.

The British Chambers of Commerce said a survey of 7,500 firms found that manufacturing fared worse than the services sector and was “close to stagnation” after domestic and export sales fell to below their pre-recession levels in 2007.

The BCC said that without government action to improve workers’ skills, upgrade outdated infrastructure, and allow small firms access to the same cheap credit available to major businesses, “the UK economy could suffer negative consequences in the face of increasing global uncertainty”.

The finding – which echoes official figures showing a contraction in factory output at the end of last year – came after analysts said the impact of government spending cuts, jittery world markets and the prospect of an EU referendum vote had dragged down expectations of UK services growth this year.

The services sector, which accounts for more than three-quarters of economic activity and ranges from shops and hotels to banking, maintained its solid growth in the run-up to Christmas, but the Markit/Cips survey found that expectations for business activity over the next 12 months were the weakest for almost three years.

via The Guardian

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza