Brexit has fallen into second place as the most significant risk facing company bosses for the first time since the EU referendum, as weak domestic growth saps demand for their goods and services.
According to a Deloitte survey of chief financial officers (CFOs) at some of the UK’s biggest businesses, companies are now less pessimistic about Brexit after ministers agreed the terms of a transition period with Brussels to smooth Britain’s exit from the EU.
Reflecting the views of 106 companies, including almost a quarter of the FTSE 100, the survey found a fifth of business leaders were more optimistic about their firm’s prospects than they were three months ago. On a scale of 0 to 100 for the risks facing their business, the CFOs assigned a rating of 56 for Brexit versus 57 for weak demand as a result of sluggish growth in the economy.
Deloitte said this was the first time since the spring of 2016 – before the EU referendum – that Brexit had fallen behind any other potential risk facing businesses, although admitted that some of the weakness seen in the economy will have come as a result of the vote to leave the EU.
David Sproul, senior partner and chief executive of Deloitte for north west Europe, said: “Weak UK demand is cited as the top concern, though there is likely to be a relationship between the two. Brexit remains a major concern for UK CFOs, though one which, in the wake of the announcement of the transition deal, is easing.”