UK economic performance is ‘outstanding’

Following on from the Brexit vote of June 23rd, economists, commentators, politicians and the business community were inundated with dire predictions of almost immediate recession. The economy, we were told, was due to take a massive hit as consumer spending and business confidence dropped like a stone. Many were bracing themselves for what promised to be turbulent times.

UK economic performance is ‘outstanding’

However, those plugging away to keep the economy ticking over have seen success with recent economic figures which show the UK economy was the fastest-growing of the advanced economies last year, with the services sector hitting a 17-month high and the FTSE 100 closed on a record high for the sixth consecutive time on Thursday.

A strong start to 2017 has seen recognition for UK business with property, investment, stocks and manufacturing all praised for their resilience.

Businesses seem to have turned a corner in the fourth quarter after a fall in confidence in the previous three months. Official figures from the British Chambers of Commerce showed that GDP growth was among the highest in the developed world, finding that the economy remained robust in the last few months of the year in part due to the boost from the lower pound, which made British exports cheaper.

Most firms in the manufacturing and services sectors were confident their turnover would grow, job opportunities would increase and investment would improve in the next year. Manufacturers were the biggest beneficiaries from the currency crisis according to the survey, which found that a similar number of firms reported a rise in exports, +16%, as in the third quarter. The balance for export orders was +13%, similar to +12% in the previous quarter. Both balances were up from +1% in the same quarter last year.

Emerging once again with another impressive performance was the property market with buy-to-let and off-plan property enjoying bumper performances over 2016. This has filtered into the New Year and 2017 looks promising. One trend that started in the previous year but follows in to 2017 is London prime property struggling to gain any sort of traction, with Savills reporting further drops in value and demand. The London market has fallen so far that large agents such as Foxtons and Countrywide are seeing big drops in their share price with more hardship forecast for them over the coming year.

By way of comparison, cities such as Manchester, Liverpool and Leeds are continuing to see strong growth and an increase in demand, especially from foreign investors keen to make the most of beneficial currency exchange rates. According to Zoopla’s Zed-index, the average cost of a home in Greater Manchester this year was £190,771, up from £179,747 in 2015, showing the real potential available to investors and landlords throughout the North in 2017.

As we approach a crunch time for the UK and the economy, the increase of building projects across these Northern cities acts as a statement of intent from developers keen to crack on with pushing the economy towards success. If the figures which emerged this week are anything to go by then we can look forward to a bumper year.


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