By Claire West
Importers and exporters confidence soared in November, after it was revealed that trade played a large part in boosting UK economic growth in the third quarter of 2010.
Its highest level in 8 months, the Travelex Confidence Index rose 8 points during November to stand at 112. Importer & exporter confidence surged unexpectedly as 70% said they felt confident about current trade conditions.
The rise in positive sentiment was driven by stronger than anticipated economic growth in the third quarter of 2010, as trade made its biggest contribution to UK growth in two years.
Confidence in the UK economy also flourished in November, as a string of strong economic data created a ‘feel good factor’ within the sector. 85% of importers and exporters felt confident that UK economic growth would be sustained, a rise of 19% from the previous month.
Travelex Global Business Payments said that the Office for Budget Responsibility (OBR) would welcome the rise in confidence as the OBR have forecasted trade to contribute 0.7% to the UK’s economic growth over the next 5 years. “Their increasing confidence will be good news for the OBR, who have presented some bullish trade forecasts for 2011,” commented David Sear, Global Managing Director at Travelex Global Business Payments.
Confidence in an export led recovery shot up to 49%, the highest it has been since April. There was also an increase in confidence in future trade conditions, as 68% were confident that there would be an increase in demand over the next 6 — 12 months.
David Sear said, “Confidence in the trade sector is pivotal to the UK’s economic outlook. We urge the Government to continue their vital trade overseas missions and support for exporting businesses through innovation and resource, to ensure that growth in the UK export sector is not jeopardised in 2011.”