CBI predicts ‘solid’ economic growth

The CBI's director of economics Rain Newton-Smith
The CBI's director of economics Rain Newton-Smith

The economy is expected to sustain a “solid” pace of growth for the rest of the year thanks to lower oil prices and inflation, a leading business group has predicted.

The CBI said a survey of over 750 firms showed that the rate of growth slowed in the quarter to June, largely due to a fast pace last month in business and professional services not being sustained.

Manufacturing growth remained “moderate”, with a brighter picture in retail.

Rain Newton-Smith, the CBI’s director of economics, said: “Despite an easing in performance this month, activity over the quarter as a whole has been good.

We expect the economy to sustain a solid pace of growth over the remainder of the year as lower oil prices and inflation continue to boost real incomes and consumer spending.

“But exporters face real challenges, especially from the impact of a stronger pound against the euro and still weak global export markets.

“Whatever the results of the referendum in Greece, we urge eurozone leaders to move quickly towards a deal that underpins both growth and financial stability, providing certainty for Greece and the wider eurozone.”