Agents' Summary of Business Conditions - May 2010

• The pace of consumer spending growth, which had been slowing since the end of 2009, appeared to have stabilised.
• The number of homes for sale had risen, prompting a further correction in the imbalance between demand and supply in the housing market.
• Investment intentions had stabilised in recent months, and there were occasional reports of businesses planning to invest more in the year ahead.
• Exports continued to increase gently, although the pace of recovery had been constrained by weak growth in the United Kingdom’s main trading partners.
• Both business services turnover and manufacturing output had continued to recover gradually.
• Output in the construction sector had begun to stabilise.
• Credit conditions remained tight, although there were further reports of a marginal improvement in the availability of bank credit.
• Employment intentions remained stable, but there were a few signs of selective plans for increased hiring during 2010.
• Pay growth remained muted, although there had been a slight increase in pay awards relative to late 2009. In most cases, those awards were aimed at rewarding performance, recognising employees’ loyalty and boosting morale.
• Overall, materials costs continued to rise, in some cases sharply. Higher steel, plastic, timber and fuel prices were regularly cited as putting upward pressure on businesses’ costs.
• Imported goods prices had also risen, reflecting further pass-through from sterling’s depreciation.
• Retail price inflation remained elevated.

Agents' summary of business conditions - May 2010

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