For the first time since 2011, expansion is a bigger priority for U.K. businesses than cost-cutting or stockpiling cash, according to a Deloitte survey published on Monday.
Under one-third of the 116 U.K. chief financial officers (CFOs) surveyed viewed reducing costs as a priority this quarter, and 40 percent said that introducing new products and expanding into new markets took precedence.
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"A new mood of confidence pervades the third quarter CFO Survey. Chief Financial Officers see fewer risks in the global economy and greater opportunities for expansion. The defensive strategies of cost-cutting and cash accumulation that saw corporates through the global financial crisis are increasingly out of favor. The priority now is expansion and the balance-sheet cycle has turned decisively towards growth," said Ian Stewart, chief economist at Deloitte.
A string of positive economic reports this summer have raised hopes that economic recovery in both the U.K. and mainland Europe is becoming more entrenched.
On Thursday, the U.K.'s Office for National Statistics reported the country's economy grew 0.7 percent quarter-on-quarter between April and June, its fastest rate in three years. Plus, U.K. stock market debuts are at the highest volumes since 2007, signaling an improvement in funding conditions.
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CFOs in the Deloitte survey cited growth in the U.K. as one of the main factors supporting investment in the coming 12 months, ahead of growth in emerging markets, the U.S. or Asia.
"CFOs have become markedly more positive on prospects for growth in the developed world.There's greater confidence too, that the euro will hold together. Emerging markets are a vital source of demand but CFOs are also looking to Europe for expansion," said Stewart.
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