26/08/2010
Hopes that Britain can improve upon its 1.1% growth were strengthened following a number of upbeat economic reports revealing that both High Street spending and factory orders have risen sharply.
As reported by This is Money, "two of the main engines of the British economy sparked back into life last month," and fuelled hopes that the deficit could be driven down even further than estimated.
According to The Telegraph, Britain was given four reasons to cheer: figures for retail sales, public debt, business confidence and mortgage lending all beat expectations and helped reduce fears of a double dip recession.
As reported by This is Money, a massive 40% surge in corporation tax receipts, combined with a drop in government borrowing, is also supporting the optimistic claims that the government is tackling the budget deficit much better than originally forecast.
The optimism was solidified by news that the pound grew against the dollar to $1.56, which quashed concerns that consumers were worrying about cuts which are yet to be announced.
Retail sales outgrew expectations and grew by 1.1% last month, on the back of strong clothes, sports equipment and board games sales.
Government borrowing dropped by 2.3bn in July, reaching 3.8bn as the government tries to slash the budget deficit from 11% of national income to 2.1% by 2015.
It's expected that this renewed confidence in the economy will stimulate a boost in business factoring and other borrowing options available to SMEs across the country.
Laura Nineham