Agents' Summary of Business Conditions - May 2005

We regularly publish a summary of reports compiled by our twelve regional Agents following discussions with at least 700 businesses across the UK every reporting period.

Published on 18 May 2005

Retail spending has shown few signs of recovery. Retailers were increasingly cautious about the short-term outlook, though few anticipated a further deterioration.
The housing market continued to pick up slowly from its end-2004 trough. Estate agents expected a moderate recovery to continue in the months ahead.
Export growth was modest, with markets in Western Europe remaining subdued.
Investment intentions were fairly upbeat, partly due to growing pressures on capacity.
Manufacturing output continued to rise gently, though the pace of growth may have weakened further. The global recovery in investment was underpinning demand for capital goods.
Construction output growth remained strong.
Service sector output growth picked up slightly. Activity in the business and professional services sector was especially strong.
Private sector employment growth may have stabilised in recent months. Stronger jobs growth in the service sector partly reflected the greater availability of skilled workers. Recruitment difficulties had eased.
Capacity utilisation increased slightly in the service sector, though that partly reflected special factors in professional services.
Pay pressures continued to edge up slightly.
Input price inflation remained high, though somewhat off its peak in late 2004.
Manufacturers were more able to secure price increases, though prices of retail goods continued to fall.