LONDON, Sept 30 (Reuters) - Big companies in Britain say expansion is their top priority for the first time in 18 months, a survey showed on Monday, in another sign the country’s economic recovery is on a solid footing.
Forty percent of chief financial officers polled by professional services firm Deloitte aim to venture into new markets or introduce new products or services in the next 12 months.
Thirty-five percent of respondents said increasing cash flow was a strong priority, making it the second most popular goal. Cost reduction came third, with 29 percent mentioning it.
“The mood among corporates has been transformed in the last year,” said Ian Stewart, chief economist at Deloitte. “This quarter’s survey reveals a broad-based optimism and a new focus on growth among the UK’s largest businesses.”
In a turnaround from six months ago, executives believe that Britain’s economic growth will boost their investment plans in the next year more than expansion in emerging markets or in the United States, Japan and Asia-Pacific, he added.
Confidence about the economy may also be affecting companies’ expectations for the first rise in Britain’s benchmark borrowing costs, Stewart said.
Eighty-two percent of firms think interest rates will rise from their current record-low 0.5 percent by 2015, much earlier than the Bank of England’s new forward guidance plan implies.
Last month the central bank pledged to keep interest rates on hold as long as unemployment remains above 7 percent - a threshold it did not expect to be reached before late 2016.
Deloitte interviewed 116 senior financial executives at major companies in Britain between Sept. 6 and Sept. 23.