Business investment in the United Kingdom shrank 1.4 percent on quarter in the last three months of 2018, the most since the first quarter of 2016, following an upwardly revised 1.2 percent fall in the previous period. It is the fourth straight quarter of decline in business investment, preliminary estimates showed. Year-on-year, business investment dropped 3.7 percent, the most since first quarter of 2010, after an upwardly revised 1.9 percent fall in the previous quarter. In the latest Inflation Report, the Bank of England observe that this weakness appears to “primarily reflect Brexit and associated uncertainty”. This subdued picture has been corroborated in a range of business surveys, many of which cite the effect of heightened uncertainty. Private Investment in the United Kingdom averaged 1.03 percent from 1967 until 2018, reaching an all time high of 63.70 percent in the second quarter of 2005 and a record low of -33.70 percent in the third quarter of 2005.
Private Investment in the United Kingdom is expected to be -1.00 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate Private Investment in the United Kingdom to stand at -0.80 in 12 months time. In the long-term, the United Kingdom Business Investment is projected to trend around 0.70 percent in 2020, according to our econometric models.