LONDON, Aug 9 (Reuters) - British businesses only plan to offer modest pay rises of 2 to 3 percent despite facing increased recruitment difficulties, and uncertainty is weighing on their longer-term investment plans, the Bank of England said on Wednesday.
Manufacturers reported higher exports and planned to meet increased demand via more automation and productivity gains, rather than by hiring extra workers, the central bank's regional agents said in a regular report.
Consumer spending growth slowed further in the face of rising prices, with some shoppers switching to cheaper products and brands, the report added.
It was based on conversations with businesses across Britain between June and mid-July and was considered by the BoE's top monetary policymakers last week, when they voted 6-2 to keep interest rates on hold and said the approach of Brexit was hurting growth prospects. (Reporting by David Milliken, editing by William Schomberg)