Sentiment in the private sector is consistent with the economy growing by 0.4pc in the current quarter, according to the latest quarterly business confidence monitor from ICAEW/Grant Thornton.
Their index has climbed over the last three months to a positive reading of 12.8 from 4.2 – where anything over zero shows an improvement in business confidence – signalling sentiment is at its highest in almost two years, reports The Telegraph.
If the data is correct in pointing to the UK’s return to economic expansion over January to March, that would mean the economy has avoided sliding back into recession – defined as two quarters of negative growth – after shrinking by 0.3pc at the end of last year.
The picture of improvement was reinforced by a rival survey from Lloyds Bank, showing firms’ sentiment about their trading prospects has hit at an 18-month high.
The balance tracking this, which weighs the percentage of companies that are positive about the outlook with those that are negative, rose by six points to 46pc in January, as confidence picked up particularly among manufacturers.
The increased cheer was pinned on the introduction of the Government’s Funding for Lending Scheme (FLS), while the imminent threats from the eurozone crisis and the US fiscal cliff have receded due to policy-maker’ actions.
The Lloyds data was likewise consistent with quarterly growth of 0.3pc and 0.4pc, said researchers.
Meanwhile new research continued the more positive mood music from the housing sector.
Housebuilder Barratt’s home buyers panel, representing close to 2,300 people, showed the number of people reporting difficulties getting a mortgage has halved compared to a year ago – 15pc against 30pc – as has the proportion experiencing difficulties selling their own home, now down to 17pc.
As mortgage lending improves, buyers are starting to overestimate the size of the deposit required – in some cases by a factor of three, according to the panel’s researchers Com Res.
The latest quarterly trends survey of small and medium-sized manufacturers from the CBI, the business lobby, was more mixed, but again pointed to an improving outlook.
Total new orders fell slightly for a second quarter running, companies reported, as both domestic and export demand dropped. However, both declined at a slower pace than in the previous three months and the firms polled expected orders to pick up over the next quarter.
Anna Leach, the CBI’s head of economic analysis, said: “Better news on the domestic front is expected, with output and domestic orders set to rise modestly.”
Separately, recruitment firm Reed reported the jobs market is growing, with vacancies up by 3pc in the last month, and 12pc in a year.
In the City of London, recruiters Astbury Marsden said the number of jobs created has trebled in a year to more than 2,500 last month – albeit off a low base.
