BUSINESS confidence has reached a 26-month low, suggesting an increased likelihood of a return to negative growth for the economy in the quarter ahead, according to the latest Business Trends report by North West accountants BDO.
The BDO Output Index – which measures businesses’ short-run turnover expectations – fell to 93.6 in August, its lowest level since June, 2009.
This takes the index below the crucial 95 mark that indicates growth.
In addition, the Optimism Index, which predicts business confidence two quarters ahead, is also teetering around this point for the third consecutive month, with a similarly subdued figure of 95.5.
This suggests that at best, protracted, marginal growth will persist at the start of 2012.
Jeff Jones, managing partner for BDO in the North West, said: “It’s worrying to see such a reliable growth indicator fall to a two-year low. Our predictions should serve as a wake-up call.”
