Table of Contents
Economic Overview
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- Annual GDP growth falls to decade low in 2019
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- Figure 1: Annual GDP growth rate, 2015-2019, (% change)
- Bank rate remains at 0.75%... for now
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- Figure 2: Bank Rate, 2008-2018, by date of adjustment
- CPI rate falls to three-year low…
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- Figure 3: Consumer Price Index, January 2019 - 2020, (12-month Rate)
- …whilst earnings growth continues to outstrip inflation
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- Figure 4: Real average weekly earnings, total pay, January-November 2019, (% monthly change year-on-year, seasonally adjusted)
Business Health
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- A fifth of small businesses have missed out on opportunities due to a lack of funding
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- Figure 5: Current finance situation of the business, June 2017 vs June 2018 vs June 2019, (% of respondents)
- Business turnover continues to grow in 2019…
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- Figure 6: UK business turnover, 2019, at the start of the year, by business sector, (£ million)
- … Despite insolvencies rising to a six-year high
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- Figure 7: Underlying company insolvencies in England and Wales, Q3 2017 - Q4 2019, (units, seasonally adjusted)
- Business investment levels and private sector profitability both decline
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- Figure 8: UK PNFCs net rate of return, Q3 2017 - Q3 2019, (% return)
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- Figure 9: UK total business investment, Q3 2017 - Q3 2019, (chained volume measures and not seasonally-adjusted, £ billion)
Special Focus: B2B Finance
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- Net lending levels further improve in 2019…
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- Figure 10: UK MFIs’ net loans to non-financial businesses, Q1 2018 - Q4 2019, by size of business, (£ million, not seasonally adjusted)
- … Although credit availability continues to fall
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- Figure 11: Availability of corporate credit to PNFCs in the past three months, Q4 2017 - Q4 2019, by business size, (net percentage balance)
- Write-offs on loans to NFCs rise for first time in four years in 2018 but likely to have fallen in 2019
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- Figure 12: Write offs of loans to PNFCs from banks and building societies, Q3 2017 - Q3 2019, (£ million, not seasonally adjusted)
What’s Next?
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- Business confidence bounces back from decade-low point
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- Figure 13: Business confidence index, Q4 2018 - Q1 2020, (index figure)
- General consensus implies weaker economic growth in 2020 and beyond
- Purchasing Managers’ Index Surveys
- Stagnating productivity represents the greatest hurdle to overcome
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
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