April 19, 2023

The latest survey by Deloitte shows that confidence among chief financial officers (CFOs) at the UK’s largest companies has seen its sharpest rise since 2020, with 25% more CFOs feeling positive about the future compared to 17% three months ago. The survey attributed the rebound in sentiment to improvements on several fronts, such as the fall in energy prices, the improved relations with the EU, and a period of comparative political calm after the turbulence of 2020. However, despite the change in mood, chief financial officers are still feeling risk averse, with many prioritising cost-cutting and building up cash reserves. One exception to this is investment in artificial intelligence, with an overwhelming majority of CFOs expecting significant growth in spending on AI over the next five years.

The UK economy has been struggling recently due to high gas prices, rising interest rates, a sluggish trade performance, and weak business investment. Last week, the International Monetary Fund predicted that Britain would be one of the worst-performing major economies in the world this year, shrinking by 0.3%. However, a separate forecast published by the EY Item Club on Monday found that the UK is now expected to grow by 0.2% this year, up from a previously forecast contraction of 0.7%. Despite the challenges, the survey results suggest that the economy may be turning a corner, albeit slowly, which could help stir a revival in business and consumer confidence.

Source: BBC
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