Exports were stronger than expected in the second half of 2022. BCC research also shows that while overall export values have held up, many smaller companies are not reporting any improvements in their trading conditions.

BCC has forecast a 0.3 per cent contraction for UK economy in 2023 but expects it to avoid a technical recession before returning to growth in 2024. BCC predicts a 4.5 per cent fall in exports for 2023, despite stronger-than-expected exports in H2 2022, a fall in GDP in Q1 2023, before 3 quarters of weak growth and 5 per cent inflation by Q4 2023.

In the immediate term, BCC is expecting Q1 2023 to see the gross domestic product (GDP) fall, before three quarters of flat or weak growth, leading to an overall contraction of 0.3 per cent for the year, BCC said in a release.

This is a slightly more optimistic outlook than predictions of either the Office of Budget Responsibility or the Bank of England (BoE).

BCC expects the economy to grow in 2024 at 0.6 per cent compared to the BoE’s forecast of 0.25 per cent shrinkage.

Despite a big drop in business confidence in Q3 2022, this now appears to have stabilised albeit at a lower level. Business investment has now returned to pre-pandemic levels, although it was not performing well then, BCC said.

BCC expects the UK unemployment rate to rise to 4.5 per cent in 2023, then 4.8 per cent in 2024 and then dipping to 4.1 per cent in 2025.

Fibre2Fashion News Desk (DS)