There has been a decline in the percentage of success rates of businesses applying for loans from banks. In 2007 90% of loan applications to banks were successful but in 2010 there was a fall to 65% of successful loan applications. The percentage of SMEs looking for finance increased from 35% in 2007 to 42% in 2010. A majority of three quarters of businesses went to banks when looking for loans and five out of six businesses expect to apply to banks when looking for loans in future.
The main reason for refusal of loan finance was given as a lack of collateral or a lack of own capital. Poor credit rating became the most notable reason among other lenders in 2010 whereas in 2007 reasons were more sparse. In the few cases where the failure to get finance was becuase of a refusal on the part of the applicant high interest rates were less of a problem in 2010 than in 2007. This is partly due to the fact that in 2007 the Bank of England base rate was over 5% but in 2010 the base rate was held at 0.5%.
The economic outlook was given as the main limiting factor for business growth. Price competition and small margins were also among the main reasons given along with limited demand in domestic markets.
Friday, 28 October 2011
Directors See Huge Pay Rises
Directors of FTSE-100 companies saw their total remuneration increase by an average of 55% in 2010 with Chief Executives taking home an average of £4.9m in total earnings. Total board pay in the FTSE-350 as a whole increased by an average of 45% according to the latest Directors Pay Report by Incomes Data Services. There is a risk that the attitude of getting back to 'business as usual' so soon after the 3.6% increases of the previous year will upset shareholders.
Business Confidence In Europe Shows Mixed Picture
Business confidence surveys in Europe show that economic sentiment (ESI) has remained broadly unchanged in the EU as a whole and in the euro area at respective levels of 93.8 and 94.8. There are mixed signals in the underlying data. Declines in industry and among consumers were offset by increases in retail, services and construction in EU27 and in construction and services in the euro area. While the economic sentiment results are unchanged the business climate survey (BCI) recorded a continued fall. The steady fall over the last eight months suggests a significant slowdown in production growth.
Farm Gate Price Of Milk Increase Of 2.79p/litre In September
The latest milk prices release from Defra shows that the farm gate price of milk increased by 2.79p to 28.03p/litre in September. The average butterfat content was 4.09% and the protein content was 3.31% compared with 3.92% and 3.33% respectively in September 2010.
Cereals Farmers See Big Rise In Incomes
The Farm Business Survey results show that income figures have substantially increased in the year ending February 2011. In 2010/11, incomes increased on arable and mixed farms and a smaller increase on dairy farms. However, average incomes fell on beef, sheep and pig farms. Significant variations in incomes exist within the sectors.
Mixed farms saw an increase of 57% while cereals farms increased their incomes by 107%. General cropping farms increases were 80%. The average increase across all types was 33%. In real terms it means a 97% increase for cereal farms, 72% for general cropping farms and a 49% increase for mixed farms.
Over half of cereal, general cropping and dairy farms had an income over £50,000 and a third over £75,000 but more than 15% of LFA and lowland grazing farms didn't make any profit at all and approximately 60% had incomes of less than £20,000. Different farms are influenced by a variety of different factors including size, location and soil type. The variation in incomes also reflects the differences in production costs.
Mixed farms saw an increase of 57% while cereals farms increased their incomes by 107%. General cropping farms increases were 80%. The average increase across all types was 33%. In real terms it means a 97% increase for cereal farms, 72% for general cropping farms and a 49% increase for mixed farms.
Over half of cereal, general cropping and dairy farms had an income over £50,000 and a third over £75,000 but more than 15% of LFA and lowland grazing farms didn't make any profit at all and approximately 60% had incomes of less than £20,000. Different farms are influenced by a variety of different factors including size, location and soil type. The variation in incomes also reflects the differences in production costs.
Household Saving Up On Last Quarter
The quarterly national accounts version of GDP show that household saving increased from 5.9% in the first quarter of 2011 to 7.4% in Q2. The household saving ratio over the year however fell slightly from 7.8% to 7.5%. Real household income rose by 1.2% after a fall of 1.7% in quarter one. Disposable income rose by 0.1% in 2010 after an increase of 1.6% in 2009.
Current Account Deficit Reduced To £2bn
The ONS recently published the latest balance of payments data for the UK. The current account deficit in Q2 2011 was £2bn down from £4.1bn in Q1. The total trade deficit increased from £5.8bn in Q1 to £6.8bn in Q2 2011. The UK recorded net international investment liabilities of £115bn.
The capital account showed a surplus of £1bn, up £0.3bn from Q1. The current transfers deficit decreased to £4.8bn, a fall of £0.9bn, due mainly to lower payments by the government. Payments to EU contributions can be erratic.
The trade in goods deficit increased to £24.6bn in Q2 2011 from £22.8bn in Q1. Exports fell by £1.2bn while imports increased by £0.6bn to a record £98.4bn. Trade in services also saw a new record in Q2. The surplus on trade in services grew to £17.8bn. Exports grew by £1.5bn to another record £46.1bn.
There was a net outflow of £9bn compared with a net outflow of £3.5bn in the previous quarter. Overseas investment fell to £42.7bn from £160.1bn and investment flowing into the UK in Q2 was £33.8bn down from £156.6bn in Q1.
The capital account showed a surplus of £1bn, up £0.3bn from Q1. The current transfers deficit decreased to £4.8bn, a fall of £0.9bn, due mainly to lower payments by the government. Payments to EU contributions can be erratic.
The trade in goods deficit increased to £24.6bn in Q2 2011 from £22.8bn in Q1. Exports fell by £1.2bn while imports increased by £0.6bn to a record £98.4bn. Trade in services also saw a new record in Q2. The surplus on trade in services grew to £17.8bn. Exports grew by £1.5bn to another record £46.1bn.
There was a net outflow of £9bn compared with a net outflow of £3.5bn in the previous quarter. Overseas investment fell to £42.7bn from £160.1bn and investment flowing into the UK in Q2 was £33.8bn down from £156.6bn in Q1.
Monday, 24 October 2011
European Industries See Increase In New Orders
European industries experienced an increase in new orders in August 2011 compared with July and with August 2010. The euro area index rose by 1.9% on the month and 6.2% over the year. The EU27 increases were 0.4% over the month and 6.5% over the year.
New orders for capital goods increased 2.7% in the euro area between July and August and 1.1% in EU27, non-durables increased 1.2% and 0.5% respectively, durable consumer goods fell by 0.8% and 1.8%. Intermediate goods orders grew by 1.1% in both zones. Durable consumer goods orders also fell on the annual comparison, 3.1% in the euro area and 8.4% in EU27. Capital goods orders rose by 7.8% in the euro area and 8.2% in the EU27 and intermediate goods orders by 6.1% and 6.9% respectively.
New orders for capital goods increased 2.7% in the euro area between July and August and 1.1% in EU27, non-durables increased 1.2% and 0.5% respectively, durable consumer goods fell by 0.8% and 1.8%. Intermediate goods orders grew by 1.1% in both zones. Durable consumer goods orders also fell on the annual comparison, 3.1% in the euro area and 8.4% in EU27. Capital goods orders rose by 7.8% in the euro area and 8.2% in the EU27 and intermediate goods orders by 6.1% and 6.9% respectively.
Global FDI Rises But Financial Turmoil Slows Growth
Inflows of global foreign direct investment (FDI) rose by 2% in the first half of 2011 compared with the second half of 2010 according to the latest Global Investment Trends Monitor released by UNCTAD. The increase maintains the 5% moderate recovery of 2010.
The effects of the financial crisis however are precipitating a slowing down of growth in FDI according to preliminary estimates of cross-border mergers and acquisitions and greenfield investment. The outlook is predicted to remain optimistic with FDI flows expected to be close to pre-crisis levels over the next twelve months. The emphasis on crisis management is making policy makers more cautious diverting attention away from the need for more private investment to generate growth and jobs.
In the first half of 2011 more than half of global FDI was directed towards developing and transition economies as transnational corporations are still directing their investment to emerging markets. Developed economies experienced a 4% decline in FDI in the first half of 2011.
The effects of the financial crisis however are precipitating a slowing down of growth in FDI according to preliminary estimates of cross-border mergers and acquisitions and greenfield investment. The outlook is predicted to remain optimistic with FDI flows expected to be close to pre-crisis levels over the next twelve months. The emphasis on crisis management is making policy makers more cautious diverting attention away from the need for more private investment to generate growth and jobs.
In the first half of 2011 more than half of global FDI was directed towards developing and transition economies as transnational corporations are still directing their investment to emerging markets. Developed economies experienced a 4% decline in FDI in the first half of 2011.
Friday, 21 October 2011
Government Borrowing Down £1.3bn
The current budget deficit for September 2011 was £11.9bn (excluding temporary effects of financial intervention), £0.9bn lower than 2010 according to the ONS. Net borrowing was £14.1bn also lower than in September 2010 when it was £15.4bn. Net debt £966.8bn or 62.6% of GDP compared with £833bn in September 2010. Central government net cash requirement in September 2011 was £2.1bn lower than last year at £23bn.
September Sales Up On Last Year
The value of retail sales on Britain's High Streets increased by 5.4% in September compared with last year according to a statistical bulletin released by the ONS. Volumes also increased, by 0.6%, compared with September 2010.
The monthly figures show an increase in both value and volume of 0.8% and 0.6% respectively, but although sales value increased in the last three months compared with the previous three months, the volume of sales decreased by 0.2%.
Automotive fuel increased by 20% year on year contributing 2% to the overall retail sales percentage points while predominantly food stores sales volumes fell by 0.3% but values increased by 5.7% contributing 2.4% to overall growth. Non-store retailing (including the Internet) increased 15.6% contributing 0.8%. The estimated value of Internet retail sales was £539.4m, approximately 9.6% of total retail sales.
The monthly figures show an increase in both value and volume of 0.8% and 0.6% respectively, but although sales value increased in the last three months compared with the previous three months, the volume of sales decreased by 0.2%.
Automotive fuel increased by 20% year on year contributing 2% to the overall retail sales percentage points while predominantly food stores sales volumes fell by 0.3% but values increased by 5.7% contributing 2.4% to overall growth. Non-store retailing (including the Internet) increased 15.6% contributing 0.8%. The estimated value of Internet retail sales was £539.4m, approximately 9.6% of total retail sales.
Tuesday, 18 October 2011
CPI Highest Ever
CPI annual inflation reached 5.2% in September 2011 up from 4.5% in August according to the ONS. It is the highest CPI inflation has ever been since records began in January 1997. It was also 5.2% in September 2008. RPI, an alternative measure of inflation reached 5.6%.
The biggest upward pressure came from increases in prices for energy products gas and electricity. Upward pressure also came from air transport and communications services. Clothing contributed the main downward pressure.
Housing and household services increased by 8.6% compared with 5.1% last month. Restaurants and hotels annual rate was 4.7% compared with 4.6% last month. It is the highest ever for the sector.
The biggest upward pressure came from increases in prices for energy products gas and electricity. Upward pressure also came from air transport and communications services. Clothing contributed the main downward pressure.
Housing and household services increased by 8.6% compared with 5.1% last month. Restaurants and hotels annual rate was 4.7% compared with 4.6% last month. It is the highest ever for the sector.
Friday, 14 October 2011
Unemployment Highest Since 1990s
The latest labout market statistics from the ONS show that the unemployment rate was 8.1% and the employment rate was 70.4%. Inactivity was 23.3%. The total number of unemployed people reached 2.57m, the highest since October 1994. The unemployment rate for people aged 16-24 reached 21.3%, the highest since records began in 1992.
Services Trade Surplus Still Rising
The deficit on UK trade in goods and services fell to £1.9bn in August. The goods deficit fell to £7.8bn but the services trade surplus increased to £5.9bn. The volume of exports increased by 1.3%. Both import and export prices fell by 0.5% and 1.5% respectively.
Agricultural Prices Squeezed In August
Defra released the latest agricultural prices index statistics yesterday. The monthly series shows that the index of producer prices for the total of all products fell 1.3 points from 160.3 points in July 2011 to 159 points in August. The monthly index of the purchase prices for all means of agricultural production increased by 0.7 points from 152.3 to 153 points.
The annual series shows that the index of producer prices for all means of agricultural production increased by 5.7 points from 129.9 to 135.6 points between 2009 and 2010. The index of producer prices for the total of all products increased between 2009 and 2010 from 136 points to 144.4 points, an increase of 8.4 points over the year.
The annual series shows that the index of producer prices for all means of agricultural production increased by 5.7 points from 129.9 to 135.6 points between 2009 and 2010. The index of producer prices for the total of all products increased between 2009 and 2010 from 136 points to 144.4 points, an increase of 8.4 points over the year.
Manufacturing Up But Fall In Overall Production
The latest Index of Production (IOP), recently published by the ONS, fell by 1.0 per cent in August 2011 compared to August 2010. The Index of Manufacturing, within the IOP, rose by 1.5 per cent in August 2011 compared to August 2010. Production between July and August rose by 0.2 per cent, with manufacturing falling by 0.3 per cent. This months release was the first to be based on the new UK Standard Industrial Classification (SIC).
Sector C, the manufacturing sector, contributed the largest percentage of production with 66.6%. The 1.5% increase was due to a 4.8% increase in the production of food, beverages and tobacco. Over the month food, beveages and tobacco increased by 1% with alcoholic beverages contributing a 2.9% rise. Mining and quarrying (Sector B), contributed 16.4%. Sector D, electricity, gas, steam and air conditioning contributed 9.3%.
Sector C, the manufacturing sector, contributed the largest percentage of production with 66.6%. The 1.5% increase was due to a 4.8% increase in the production of food, beverages and tobacco. Over the month food, beveages and tobacco increased by 1% with alcoholic beverages contributing a 2.9% rise. Mining and quarrying (Sector B), contributed 16.4%. Sector D, electricity, gas, steam and air conditioning contributed 9.3%.
Friday, 7 October 2011
Animal Feed Production In August Down On Last Year
The total British animal feed product for August was down 2.9% when compared with August 2010. Raw material usage was down 2.8% and integrated feed production was down 1.8%.
Quarterly average animal feed prices stood at £219/tonne for cattle and calf feed, £260/tonne for pig feed and £216/tonne for sheep feed for the period April to June 2011.
Quarterly average animal feed prices stood at £219/tonne for cattle and calf feed, £260/tonne for pig feed and £216/tonne for sheep feed for the period April to June 2011.
Fall In Wheat Usage, Barley Usage Up
There was a 7% fall in the amount of wheat milled in August 2011 from 511,000 tonnes to 475,000 tonnes. The total amount of flour milled fell by 6.5% in total. The amount of bread flour, cake flour and household flour both increased. Biscuit making flour fell by 0.8%.
Brewers, maltsters and distillers used 149,600 tonnes of barley in August, up 10.5% on the 135,300 tonnes in August 2010. Malting barley accounted for 142,500 tonnes, up 11.5%.
Oats usage was up 2.6% from 111,500 tonnes to 114,400 tonnes. Oats were mainly used for flakes, rolled oats and flour.
Brewers, maltsters and distillers used 149,600 tonnes of barley in August, up 10.5% on the 135,300 tonnes in August 2010. Malting barley accounted for 142,500 tonnes, up 11.5%.
Oats usage was up 2.6% from 111,500 tonnes to 114,400 tonnes. Oats were mainly used for flakes, rolled oats and flour.
August Retail Slightly Down On July
Eurostat, the statistical office of the European Union, says that the volume of retail trade fell by 0.3% in the euro area and by 0.2% in the EU27 in August 2011 compared with July. Comparing August 2011 with August 2010 the retail sales index fell by 1% in the euro area and 0.8% in the EU27.
The food sector increased by 0.1% in the euro area and by 0.3% in the EU27 in August compared with JUly. The non-food sector increased by 0.6% in both zones. Year on year, both sectors fell. The food sector fell by 0.2% in the euro area and by 0.5% in the EU27 and the non-food sector fell by 1.3% and 0.7% respectively.
The food sector increased by 0.1% in the euro area and by 0.3% in the EU27 in August compared with JUly. The non-food sector increased by 0.6% in both zones. Year on year, both sectors fell. The food sector fell by 0.2% in the euro area and by 0.5% in the EU27 and the non-food sector fell by 1.3% and 0.7% respectively.
Fall In Household Consumption
Household final consumption expenditure fell by 0.8% during the second quarter of 2011.
The biggest contributions to the negative growth were from the transport and food sectors. Positive contributions came from clothing and footwear and miscellaneous.
The biggest contributions to the negative growth were from the transport and food sectors. Positive contributions came from clothing and footwear and miscellaneous.
Tuesday, 4 October 2011
Business Survey Estimates Fall In Number Of Jobs
The Business Register and Employment Survey estimates that for September 2010 there were 26.8m employees, down 134,000 on 2009. Tha largest fall among the countries of the UK was in Scotland at 73,000.
The region with the most employees was London with 4.1m (15.3% of UK employees) next came the South East with 3.7m (13.8%). London also had the highest proportion of full-time employees at 74.1%. Other regions had less than 70%. The regions with the lowest number of employees were Northern Ireland with 705,000 (2.6%) and the North East with 999,000 (3.7%) with over a third part-time.
In the UK as a whole, there were 18.1m full-time and 8.7m part-time employees. The health sector continued to have the largest number of employees with 3.6m. The industry with the lowest number of employees was agriculture, forestry and fishing with 214,000 (0.8%). Construction employment decreased the most down 118,000 employees. Mining, quarrying and utilities had the largest proportion of full-time workers at 93.3%. The retail sector had the largest proportion of part-time workers at 57.2%. Business administration and support services grew by 62,000.
The region with the most employees was London with 4.1m (15.3% of UK employees) next came the South East with 3.7m (13.8%). London also had the highest proportion of full-time employees at 74.1%. Other regions had less than 70%. The regions with the lowest number of employees were Northern Ireland with 705,000 (2.6%) and the North East with 999,000 (3.7%) with over a third part-time.
In the UK as a whole, there were 18.1m full-time and 8.7m part-time employees. The health sector continued to have the largest number of employees with 3.6m. The industry with the lowest number of employees was agriculture, forestry and fishing with 214,000 (0.8%). Construction employment decreased the most down 118,000 employees. Mining, quarrying and utilities had the largest proportion of full-time workers at 93.3%. The retail sector had the largest proportion of part-time workers at 57.2%. Business administration and support services grew by 62,000.
MUICP Of 3% Expected In September
Euro area inflation, measured by the Monetary Union Index of Consumer Prices, is expected to be 3% in September 2011 according to a flash estimate from Eurostat, the Eurpean Union's statistical office.
Farm Gate Price Of Milk Up By 2.84p/litre In August
The UK average farm gate price of milk increased by 2.84 p/litre to 27.54p/litre in August 2011 compared to August 2010. The average butterfat content was 4% compared with 3.85% in August last year and 3.92 in July and the average protein content was the same as last year at 3.25% but higher than the 3.23% of July. The farm gate milk price in July was 27.2p/litre (Prices exclude retrospective bonus payments made by purchasers).
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