"The cautious optimism in global growth prospects we detected six months ago seems to be gathering pace. UK plc which rebuilt its balance sheet between 2010 and 2012, bolstered by selective equity fundraisings, seems ready to continue with the acquisition trail."
- Neil Shah, global head of research at Edison
Amid renewed economic optimism Britain's medium-sized companies are planning to increase their investment over the coming year, a survey of executive directors at more than 200 mid-cap listed companies by Edison Investment Research showed this week. Almost 56% of respondents will increase capital expenditure during the next year, figure nearly twice bigger the level of the last survey conducted just six months ago. Moreover, the number of businesses feeling optimistic about their own prospects over the coming year soared to 70% from 65% recorded in January. Figures also showed that a quarter of executives are planning to make an acquisition over the upcoming 12 months. The U.K. policymakers should welcome these findings as they are pinning hopes for a sustain recovery on a rise in business investment, while still has to return to its pre-crisis levels. Another important finding was companies' view in regards with the possible withdrawal of quantitative easing. Around 58% of respondents said they do not want to see any tapering of complete end of stimulus programme, while 63% believed it should be very harmful to the stock market. Earlier in August, the BoE pledged to maintain the stock of its QE at 375 billion pounds until unemployment rate dropped to 7% from current 7.8%. The U.K. benchmark FTSE 100 tumbled 6.3% since a high on May 22 amid concerns the Fed may start to curb its stimulus measures.
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