Bank of England finds business conditions improving but fragile

The Bank of England said its survey of business conditions found sentiment had improved since August but remained quite fragile.

In its quarterly agents’ summary of business conditions report, garnered from business contacts between late August and mid-October, the BoE said "sentiment recovered from its post-referendum fall, but remained relatively fragile alongside significant uncertainty around the longer-term outlook".

The findings pointed to investment spending in the coming year being "broadly stable or slightly lower", with a potential drag coming from uncertainty over future demand and over trading arrangements, particularly for manufacturers.

Of the 340 businesses responded to the survey, accounting for 330,000 UK employees and £8.6bn of capital spending, expectations for investment spending growth were most negative for construction and business services, particularly in the financial services sector.

Expectations were that employment is likely to be mostly flat over the next six months.