UK Business Investment Falls for 2nd Quarter in a Row

Business investment in the UK has fallen for the second quarter in a row, recording the biggest fall since 2009.

Spending by business fell by 1.4% in the fourth quarter from the previous three-month period.
The Office for National Statistics (ONS) which collects the data said falling oil prices may be to blame.

The oil price has fallen by over a half since June last year, and oil companies have pulled back on investment in the UK and around the world.

“Given the recent steep fall in oil prices, it might be expected that investment by the oil extraction industry might also fall, as oil production becomes less profitable,” the ONS said.

Earlier this week the industry body Oil and Gas UK said that after reaching £14.8bn last year investment was forecast to fall to between £9.5bn and £11.3bn in 2015.

Economists have said overall business investment in Britain might also be affected by uncertainty over the outcome of Britain’s national elections in May.

On an annual basis, investment still increased by 2.1% on the same period a year ago.
But it marks a sharp slow down from the middle of last year when business investment was growing at an annual rate of 11%.

via BBC

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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