Agents' Summary of Business Conditions - July 2010

• There had been some signs that consumer spending growth had slowed through Q2.
• Activity in the housing market, which had been rising gently for much of 2010, had also eased back.
• Investment intentions remained consistent with a gentle rise in spending, rather than a more robust recovery.
• Export volumes rose at a steady pace, with a growing number of contacts selling to new, fast-growing markets.
• Services turnover had continued to grow modestly, reflecting higher demand for professional services, as well as a small increase in distribution activity.
• Manufacturing output had risen further, on the back of stronger external demand and, to a lesser extent, domestic demand.
• Construction output had been little changed in recent months. But the level of activity remained lower than a year earlier, and contacts feared a further contraction over the next year or so.
• Credit conditions remained tight for many firms, although the Agents sensed that the availability of funding had improved a little during 2010.
• Contacts expected a small increase in private sector employment over the next six months, but public sector employment was expected to fall.
• Pay growth remained muted overall, although the upward creep in wage settlements noted in the past couple of months had continued.
• Businesses’ input costs had risen further, reflecting increases in global demand as well as some supply shortages for certain components.
• Corporate margins had, on balance, been little changed over the past year (see box).
• Consumer price inflation remained elevated. Most contacts had expected a rise in VAT to be announced in the June 2010 Budget, but it remained too early to assess the degree to which the rise would be passed on to consumers.

Agents' summary of business conditions - July 2010

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