UK services sector optimistic, CBI survey finds
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It seems optimism among the people who run businesses in Britain’s services sector is now higher than at any time since the UK’s June vote to leave the European Union.
That is the finding of a major survey of companies by the employers organisation – the Confederation of British Industry.
The outlook among business and professional services firms was the most upbeat since November 2015, while consumer services firms’ optimism was close to levels last seen in May.
Brexit vote linked price increases
But there was bad news for their customers with businesses saying they expect to increase prices at the fastest rate in around 10 years over the next three months.
“Firms anticipate increasing pressure on margins over the next quarter, with the strongest expectations for price growth in 10 years, making the business environment that bit tougher,” CBI chief economist Rain Newton-Smith said.
Price rises gathering pace – especially in consumer services #services#CBI_SSShttps://t.co/My4XFjhMC1pic.twitter.com/8pqy8QIPcp
— CBI Economics (@CBI_Economics) February 27, 2017
They are having to pass on to consumers almost all of the large rise in their costs due to the slide in the value of the pound since the Brexit vote.
The survey results contrast with official data released last week which showed slowing momentum in the services sector at the end of 2016. Year-on-year growth dropped to a six-month low of 2.8 percent in December from November’s 3.2 percent.