The BDO optimism index rose to 100.42, remaining above the 100-point mark for a fifth consecutive month—a strong indicator of confidence in the business community.

However, this increased optimism stands in stark contrast to the challenges faced by many businesses. The BDO output index dropped by 1.52 points to 98.19 in September, as both the manufacturing and services sectors struggled to maintain momentum from the previous month.

Manufacturing, in particular, faced renewed job cuts due to subdued demand, while supply chain disruptions and rising shipping costs, exacerbated by the Red Sea crisis, have led to longer delivery times and higher raw material costs.

The BDO inflation index eased slightly in September, dropping to 96.41. But while input prices decreased, the persistent rise in consumer prices—particularly for services—suggests that inflationary pressures could resurface in the coming months.

Meanwhile, the BDO employment index saw its fifteenth consecutive decline, dropping to 95.45—its lowest point since January 2013, BDO said in a release.

The loosening labour market is evidenced by slowing wage growth and a continued decline in job vacancies. Although the Bank of England’s recent interest rate cut has been welcomed, its effects have yet to filter through to the labour market, meaning relief for job seekers could be slow to arrive.

Fibre2Fashion News Desk (DS)