CFOs reported an improvement in prospects for growth across the developed world, in particular the UK and US, which are forecast to be the fastest growing G7 nations this year. By contrast, prospects for growth in emerging markets have deteriorated, said the survey.
Retail sales data also looks to be improving in the UK, with last week’s figures from the Office of National Statistics (ONS) showing a positive trend. “These results are a further sign that consumers are starting to release the handbrake on their discretionary spending, whilst continuing to keep an eye on costs when shopping for essentials,” said Ian Geddes, UK head of retail at Deloitte. “Food retailers continue to struggle, despite easing inflation, as consumers remain focused on price. The strongest growth in non-food sales for over a decade is undoubtedly flattered by the comparison with last March, when bad weather hit footfall. However, this confirms our view that there is a strong momentum in the consumer market which we expect to continue, and if anything accelerate, as growth in real incomes increases.”
According to Deloitte’s Consumer Tracker, consumers intend to increase their discretionary spending by six percentage points in the second quarter of this year compared to the same period a year ago, whereas the number of consumers intending to spend more on essentials will come down by one percentage point.
The CBI believes the outlook for the UK economy over the next three months is “exceptionally strong and broad based.” Its latest monthly survey of 675 firms indicated growth expectations were the strongest since the CBI started collecting data in 2003. Retail and services showed the strongest output growth in the April data, with manufacturers reporting solid progress.
The figures, said the CBI, provide further encouraging signs of increasing vigour and confidence across the UK economy.
