Agents' Summary of Business Conditions - December 2010

• The Agents reported that the annual pace of growth in both retail sales values and consumer services turnover was broadly unchanged.
• The housing market softened further, with sales of both new and existing homes falling back.
• Investment intentions continued to improve, particularly in manufacturing, on the back of rising exports and planned efficiency gains.
• Growth in exports remained rapid, particularly of goods, driven by demand from emerging markets. Demand had also picked up in the euro area and the United States.
• Services turnover growth had softened slightly, reflecting continued downward pressure on fees.
• Manufacturing output was still growing robustly, helped by strong overseas demand.
• The Agents’ score for construction output turned positive, indicating that the level of activity had risen compared to last year. But there were concerns about the outlook.
• Large firms had seen a further improvement in credit conditions but small firms continued to report that conditions remained tight.
• Private sector employment intentions rose a little, driven by the consumer services and manufacturing sectors.
• The degree of spare capacity remained wider than usual, particularly in services.
• Labour costs continued to edge up, reflecting rising productivity. And there was also a degree of compensation for past wage restraint.
• Materials cost inflation remained robust, due to global demand and supply pressures.
• Rising costs had been passed on to some extent in manufacturing output price inflation.
• Contacts continued to expect to pass on the bulk of the rise in VAT, with some already having raised prices.

Agents' summary of business conditions - December 2010

• Agents' scores (xlsx)
• Definitions for the Agents’ scores
• Response to consultation on changes to Agents' scores