The confidence of British exporters that they will sell more overseas, according to new research from professional services firm Grant Thornton.
Grant Thornton’s research shows that in the three months after the UK voted to leave the EU, the gap between exporters expecting growing sales overseas in the next year now stands at 19 percentage points, compared to a gap of just 9 percentage points prior to the referendum.
Much of that optimism among exporters is driven by the record fall in the pound witnessed since June 23.
Sterling has crashed more than 17% since the vote to leave the EU, falling sharply in the first few weeks after the vote, before briefly recovering, and then crashing again over the course of September and October. It now stands at just $1.21 against the dollar, meaning that for many overseas buyers, purchasing British goods is now cheaper than at any point in the last 31 years.
“Whilst the subsequent weakness of the pound will be a cause for concern amongst some importers, many businesses are now reviewing their export strategies and looking for ways to make the most of the newfound competitiveness of British goods and services abroad,” Robert Hannah, Grant Thornton’s COO said.
The research — which Grant Thornton says included 2,600 businesses in 37 different countries, with 125 in the UK — shows that while exporters are confident that the crumbling pound will allow them to increase overseas business, Brexit has shot their confidence in almost every other area.
51% of businesses had a positive outlook for their revenues, compared to 52% at last reading, while for employment prospects confidence fell from 22% to 20%. Businesses who expected higher profits over the coming year fell from 53% to just 42%.
Overall, business confidence dropped by close to half, falling from 40% to 21%, Grant Thornton said.