UK Financial Services Industry Still Divided on Economic Prospects

UK financial services practitioners have grown more pessimistic on the outlook for the British economy over the summer, according to the latest survey by the Chartered Institute for Securities and Investment (CISI), which could have serious repercussions for bank lending or corporate investments.

CISI reports that out of more than 320 survey respondents, 27% said they were more optimistic for the UK’s prospects than three months ago. There was increased pessimism among 28%, however, while 45% said that their views on the UK’s economic outlook had not changed.

When the CISI last ran the survey in April 2012, 42% considered that the UK was on the road to recovery and 23% were less optimistic, while 35% believed the economy would get neither better nor worse.

One respondent said: “The public need to be encouraged to spend more of their disposable income on domestic goods and services. The politicians seem afraid to say this, but it’s time to reverse the recent culture of thrift.” Another warned: “Once Europe folds, the UK will take a severe beating.”

When the CISI ran the same survey in summer 2011, 26% of respondents were upbeat about a UK recovery, 35% predicted a downturn for the following quarter and 39% thought the economy would remain at the same level.

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