Agents' Summary of Business Conditions - August 2012

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 15 August 2012
  • The rate of growth of spending on consumer goods and services had slowed further.
  • The housing market had weakened somewhat in recent months, but contacts were uncertain whether that reflected temporary factors.
  • Contacts’ plans for capital spending had softened and the level of investment was expected to grow only very modestly over the next six months.
  • Export growth had moderated significantly, largely due to weakness across the euro area.
  • The pace of growth of turnover in the service sector had slowed further.
  • Manufacturing output growth had eased and the level of activity was only slightly higher than a year earlier.
  • Construction output continued to contract, due in large part to the dwindling pipeline of public sector work. Recently, temporary factors had also pushed down on the level of activity.
  • Credit conditions remained polarised between those able to borrow at reasonable rates and those unable to secure finance at a cost that was acceptable.
  • Employment intentions remained fairly flat. In an uncertain environment, businesses were hesitant about committing to changes in payroll until the outlook became clearer.
  • Capacity utilisation in the manufacturing sector was a little below normal, while there was a significant degree of spare capacity in services.
  • The rate of growth of labour costs per head remained restrained and had fallen in recent months.
  • Inflation in the cost of raw materials continued to moderate, in large part due to weakening demand growth in the rest of the world.
  • The pace of inflation in manufacturing output prices was declining in response to softening cost pressures. Taken as a whole, fees for business services were broadly unchanged from a year earlier, in large part due to persistent spare capacity in much of the sector.
  • Consumer price inflation continued to fall back towards the 2.0% target.

PDFAgents' summary of business conditions - August 2012

This page was last updated 31 January 2023