Improvement in domestic sales boosts London business confidence

Confidence among London’s business has jumped in the second quarter of the year thanks to rising sales at home and abroad, according to a new survey to be published today.

A business confidence index tracked by the Institute of Chartered Accountants (ICAEW) bounced back into positive territory, to a reading of 3.4, well above the negative 12 mark recorded at the start of the year.

Domestic sales rose by 2.7 per cent in the quarter, a small improvement from the 2.5 per cent growth rate seen in the same quarter last year.

Exports surged by 4.6 per cent year-on-year, a notable increase compared to the three per cent in 2017.

Read more: Rising confidence points to rebound in growth from dire first quarter

The figures match an expected pick-up in growth in the second quarter, following an almost stagnant British economy in the first three months of the year. Economists expect GDP growth to increase markedly from the earlier 0.1 per cent expansion.

Harpreet Panesar, ICAEW London director said: “It is excellent to see the capital’s business confidence reach positive territory despite continuing uncertainty around the likely impact that Brexit will have on key sectors such as property and banking, finance and insurance: all industries on which London continues to rely.

“A driving force behind this improvement is rising investment in the first half of 2018, while domestic sales are also on the rise.”

However, businesses’ desire to invest in staff development and research and development has been weighed down by political concerns surrounding the Brexit process and regulatory changes such as the recently introduced General Data Protection Regulation, the ICAEW said.

Read more: Consumer confidence to show small pick-up in British economic bellwether