Britain’s economy shows little sign of breaking out of its lethargy and it is “extraordinary” that the Bank of England is considering raising interest rates, the British Chambers of Commerce said on Friday.
The BCC’s Quarterly Economic Survey of businesses, the largest of its kind, said sales at services firms that make up the bulk of the economy were steady in the third quarter.
But there was little sign of a pick-up in pay pressures or investment, both of which the BoE expects to rise markedly next year.
Overall the BCC described the survey as “uninspiring”, with political uncertainty, currency fluctuations and Brexit clearly affecting British businesses.
Despite confounding forecasts that the 2016 vote to leave the European Union would lead to a sudden slowdown, Britain’s economy has struggled this year, posting its worst first-half performance since 2012.
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The BCC said price pressures in companies, while high historically, looked likely to peak soon.
“Against this backdrop, it seems extraordinary that the Bank of England are considering raising interest rates,” said Suren Thiru, BCC head of economics.
In September the BoE said interest rates would probably rise “in the coming months” if the economy continued to grow and price pressures kept building.
A majority of economists polled by Reuters think the BoE will make its move at its next meeting in November - but most also said it would be a mistake to act now.
“We’d caution against an earlier than required tightening in monetary policy, which could hit both business and consumer confidence and weaken overall UK growth,” Mr Thiru said.
Manufacturers enjoyed a better quarter, with domestic and export sales improving slightly, the BCC said.
While gauges of confidence in turnover and profitability stood at their highest levels since 2015, the BCC survey showed little desire among manufacturers to increase investment.
A slightly larger proportion of manufacturers said they expected to raise prices, but this was mostly down to the cost of raw materials rather than pressure from pay settlements.
In the services sector, a net 15 per cent of firms reported that pay was putting pressure on prices - up just a percentage point from the five-year low struck in the second quarter.
Other surveys, including one from the BoE’s regional advisers, have pointed to similar weakness in corporate pay intentions.
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Fuel economy, combined: 9.0L / 100km
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Engine: 6.75-litre twin-turbocharged V12 petrol engine
Power: 420kW
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Tips for job-seekers
- Do not submit your application through the Easy Apply button on LinkedIn. Employers receive between 600 and 800 replies for each job advert on the platform. If you are the right fit for a job, connect to a relevant person in the company on LinkedIn and send them a direct message.
- Make sure you are an exact fit for the job advertised. If you are an HR manager with five years’ experience in retail and the job requires a similar candidate with five years’ experience in consumer, you should apply. But if you have no experience in HR, do not apply for the job.
David Mackenzie, founder of recruitment agency Mackenzie Jones Middle East
2025 Fifa Club World Cup groups
Group A: Palmeiras, Porto, Al Ahly, Inter Miami.
Group B: Paris Saint-Germain, Atletico Madrid, Botafogo, Seattle.
Group C: Bayern Munich, Auckland City, Boca Juniors, Benfica.
Group D: Flamengo, ES Tunis, Chelsea, (Leon banned).
Group E: River Plate, Urawa, Monterrey, Inter Milan.
Group F: Fluminense, Borussia Dortmund, Ulsan, Mamelodi Sundowns.
Group G: Manchester City, Wydad, Al Ain, Juventus.
Group H: Real Madrid, Al Hilal, Pachuca, Salzburg.
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2025 Fifa Club World Cup groups
Group A: Palmeiras, Porto, Al Ahly, Inter Miami.
Group B: Paris Saint-Germain, Atletico Madrid, Botafogo, Seattle.
Group C: Bayern Munich, Auckland City, Boca Juniors, Benfica.
Group D: Flamengo, ES Tunis, Chelsea, Leon.
Group E: River Plate, Urawa, Monterrey, Inter Milan.
Group F: Fluminense, Borussia Dortmund, Ulsan, Mamelodi Sundowns.
Group G: Manchester City, Wydad, Al Ain, Juventus.
Group H: Real Madrid, Al Hilal, Pachuca, Salzburg.
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This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
UAE currency: the story behind the money in your pockets
NO OTHER LAND
Director: Basel Adra, Yuval Abraham, Rachel Szor, Hamdan Ballal
Stars: Basel Adra, Yuval Abraham
Rating: 3.5/5
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T20 World Cup Qualifier
Final: Netherlands beat PNG by seven wickets
Qualified teams
1. Netherlands
2. PNG
3. Ireland
4. Namibia
5. Scotland
6. Oman
T20 World Cup 2020, Australia
Group A: Sri Lanka, PNG, Ireland, Oman
Group B: Bangladesh, Netherlands, Namibia, Scotland
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Killing of Qassem Suleimani
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