Domestic sales and profit growth are expected to slow down in the next 12 months, as business confidence remains static.

The Institute of Chartered Accountants in England and Wales (ICAEW) finds that the number of businesses concerned about their economic prospects continues to surpass those expecting conditions to improve.

However, exporting is expected to increase due to the fall in sterling.

Predictions:

• Average total salary growth is expected to be 1.6% in the next 12 months
• Exports are expected to outpace domestic sales for the first time since Q4 2013
• Consumer spending will be affected by minimal salary growth and inflation.

Michael Izza, chief executive at the ICAEW, said:

“Sluggish growth means a slowdown in tax and VAT revenues so the government will need to start acting more like a business and utilising every asset it has to ensure the best return.

“The forthcoming Autumn Statement is an opportunity therefore to encourage businesses to make the most of the fall in sterling, build on the renowned reputation UK companies have globally and to start and increase exporting to new markets.”