Latest firm survey from the Bank of England
Activity growth had edged up, but businesses remained cautious about prospects. The fall in sterling since June had led to higher goods export volumes. Consumer demand had been boosted by rising tourist spending
Contacts expected consumer spending to slow next year as higher inflation squeezed consumers' spending power. Firms' intentions pointed to only small increases in investment over the coming twelve months. Many companies were choosing to hold a larger amount of cash given high levels of uncertainty
Input cost inflation had picked up sharply. That was expected to start affecting consumer prices more noticeably in the New Year. Wage growth had remained stable, but some contacts expected upward pressures, including from higher inflation next year
Consumer spending growth had remained resilient. Growth in retail sales values had picked up, in part as tourist spending had risen. There were expectations of slowing demand growth next year as higher inflation squeezed spending power
Investment intentions pointed to only small increases in spending over the coming year. Many companies were choosing to hold more cash instead, given high uncertainty
The full survey summary is here. As you can see, the fall in the pound has boosted tourism. It certainly won't plug the gap between rising import costs but every silver cloud and all that.
One other key area noted was commercial real estate;
Investor demand in commercial real estate had edged higher from a low base. However, there were signs that occupier demand had started to soften in London
The reason I've highlighted this is that investment funds and foreign investors have been big buyers of commercial property over the years. This was one area that would have seen flows out after the Brexit vote, so it's a small positive that maybe those have stopped or indeed reversed.
