‘DRIVE’ OF CAPITAL’S FIRMS STILL SUPPORTING GROWTH

EXCLUSIVE

JACK BARNETT

LONDON businesses are shaking off all the doom and gloom swirling around the UK economy and are poised to power the country’s recovery, research shared exclusively with City A.M. has found.

The capital’s firms are standing up to rising costs and shaky consumer demand, but are still alive to inflationary threats, according to the London Chamber of Commerce and Industry’s (LCCI) latest Capital 500 survey.

Some 24 per cent of London businesses notched an increase in domestic sales in the second quarter of this year, up from 21 per cent in the three months to March.

It is a sign that the capital’s economy is in rude health despite firms being

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squeezed by rising energy, wage and interest bills and consumer finances taking a knock from surging prices.

The research “shows yet again the resilience and entrepreneurial drive of the London business community despite the economic headwinds,”

Richard Burge, chief executive of the LCCI, told City A.M. Last quarter’s improved performance is lifting confidence in future income flows. Nearly two in five companies expect their profitability and turnover to grow in the next 12 months, the LCCI said.

Similarly, 24 per cent of the 510 firms surveyed by Savanta for the LCCI are optimistic about London’s economy over the coming year. They are less buoyant about Britain’s overall prospects, with 44 per cent of London firms souring the country’s economic health.

Meanwhile, employment in the capital is on course to expand in the coming months as well. Just five per cent of companies plan to trim their workforce, while 22 per cent are set on bringing in new staff.

UK families are being gripped by sticky inflation and much higher interest rates. Prices have jumped 8.7 per cent over the last year to May, the same rate of change registered in April. Experts thought the rate would fall.

Persistent inflation has compelled the Bank of England to hike interest rates 13 times in a row to a near 15-year high of five per cent. Last month, governor Andrew Bailey and co shocked markets by sending borrowing costs up 50 basis points. Financial markets think they will peak at more than six per cent. There were signs in the LCCI’s research that inflationary pressures are hanging around, but are at least cooling. Some 43 per cent of firms intend to hike prices in the next three months, down from half in the last quarter.

JAMES SILVER

DEDICATED tennis fans began queueing over the weekend to ensure they get through the door at Wimbledon later today, with The Championships beginning at the All England Lawn Tennis Club in southwest London.

Tickets to the tournament sold out through the always over-subscribed ballot but the queueing system remains in place, with fans able to secure both ground passes as well as tickets to the so-called show courts.

Suzanne Pyefinch, 57, from Norfolk joined the queue for the 38th consecutive year.

“Come early, be prepared to wait, bring lots of drinks, and a comfortable chair, wait for your ticket and go and have a great day,” she said.

As for keeping spirits up, the queue veteran had some advice for newbies.

“Pimm’s is great, but you need your tea and coffee,” she said.