1 March 2015

  |  CBI Press Team

News

Economy growing at a steady pace

Economic growth was slightly slower in the three months to February, but still maintained a strong pace, according to the latest CBI growth indicator.

Economy growing at a steady pace

The survey of 842 respondents across manufacturing, retail and services showed continued solid growth in the private sector, with a balance of +19% in February. Whilst the pace of growth eased (from +23% in January), it remained in line with the average rate over the past four months.

The overall outlook for the next quarter is positive, with growth expected to rise further (+26%).

February’s slightly weaker performance was driven by slower sales growth in the retail sector, where volumes were broadly flat. Meanwhile, business volumes growth remained steady in the services sector, and manufacturing output growth picked up, with manufacturers’ expectations for the coming three months hitting a five-month high.

Rain Newton-Smith, CBI Director of Economics, said:

“The economy is heading steadily along the right track. The post-Christmas dip in retail sales was a surprise, but it’s encouraging that firms’ overall growth expectations are upbeat across all sectors.

“Lower oil prices mean consumers have a bit more money in their pockets after filling up at the pump, as well as reduced costs for firms. But the North Sea oil industry is being hit hard, so as an immediate step, the Government should commit to reducing the Supplementary Charge to 20%.

“Businesses will continue to keep a close eye on developments in the Eurozone, which is fending off deflation, particularly with heightened uncertainty over Greece’s fiscal position.”