Business confidence at its highest since 2015 according to KBC/CAI data

Business, Economy | Wed 23 Aug | Author – Business & Finance Business confidence highest since 2015 according to KBC/CAI data

Irish business confidence is at its strongest since late 2015, according to the KBC Bank Ireland/Chartered Accountants Ireland business sentiment index for summer 2017.

The index stands at 118 for Q2, compared to 110.6 for Q1, and was driven by increased business activity levels and “a further easing in concerns about the outlook for the Irish economy”.

The data represents the fourth quarterly gain in a row, rising above pre-Brexit/US election levels, but falling short of the 131.1 mark seen in 2015. It is informed by 354 chartered accountants in senior positions, such as CEOs, managing directors and financial directors, in Ireland’s leading companies.

“The improvement seen in business sentiment in summer 2017 is really encouraging in that the details of the survey suggest the recovery is now reaching a notably wider range of companies and that earlier fears of a speedy and substantial hit to activity from Brexit have not materialised,” explained Austin Hughes, chief economist of KBC Bank Ireland. “Instead, activity has increased and is expected to grow further in the coming quarter.”

Of Brexit concerns, the business confidence data indicated that 77% of companies have some sense of the potential effect of Brexit on their businesses, and more than half have acted accordingly, said Barry Dempsey, CEO of Chartered Accountants Ireland.

“This is positive in that it suggests Irish business has been proactive in assessing and implementing a response to Brexit rather than being lulled into complacency by limited signs of progress in the formal Brexit negotiations thus far or the possibility of a significant ‘transition’ period after 2019 when the UK is scheduled to leave the EU.”

Dempsey also noted that although there has been no increasing in hiring activity, the number of firms reporting reduced headcount is at its lowest level since the survey began 11 years ago.