UK factories roar back to life after Boris win

Confidence jumps by the most in 62 years

Sajid javid has been handed a major boost ahead of his first Budget as Chancellor as a flurry of reports suggested the UK economy is rude health.

as the Chancellor ( pictured) clashed with the americans over trade and taxes in davos, a survey found the mood among British manufacturers picked up by the most in more than 60 years following the election.

at the same time, figures from the Office for National Statistics (ONS) showed borrowing fell by more than expected at the end of last year, giving him extra leeway in the Budget in March.

and the ONS also said exports of services rose by £3.9bn to £82.1bn in the third quarter of last year, with £33bn going to the European Union and a far greater £49.1bn to the rest of the world.

With Britain finally leaving the EU next week, the report underlined just how much business Britain does with the rest of the world.

The triple-whammy of good news came a day after official figures showed employment in the UK hit a record high of 32.9m. Unemployment is just 3.8pc, the lowest since 1974 and around half the jobless rate of 7.5pc seen in the eurozone.

‘it looks promising,’ said Howard archer, chief economist at the Ernst & Young item Club. ‘This is all good news for the Chancellor. The economy certainly seems to be picking up.’

in a closely watched survey of British manufacturers, the CBi said that optimism in factories hit its highest level since early 2014 following Boris johnson’s election victory last month.

The group added that the improvement in sentiment compared with three months ago was the largest it has seen since it started collecting the data in 1958.

Manufacturers are also far more willing to invest in new plant and machinery than they were before the election, the CBi said.

The survey of 300 firms was carried out between december 16 and january 13 in the immediate aftermath of the Tory victory over hard-Left Labour leader jeremy Corbyn.

Thomas Pugh, UK economist at Capital Economics, said: ‘all this gives a clear indication that companies are feeling much more upbeat.’ anna Leach, CBi deputy chief economist, said: ‘it’s clear manufacturers are entering the new year with a spring in their step. Firms are now planning to invest more in plants and machinery, which will ultimately help increase capacity and output.’ in a further boost to the

Chancellor, the ONS said that the Government borrowed £4.8bn in december.

That was less than the £5.3bn expected by analysts and £200m lower than in december 2018.

Borrowing in the financial year to date, april to december, stood at £54.6bn. This was £4bn higher than in the same period the previous fiscal year, but still lower than had been expected by the Government’s fiscal watchdog, the Office for Budget Responsibility (OBR).

analysts said that the Chancellor was now on course to borrow £41bn in 2019-20, which is some £6.6bn less than pencilled in by the OBR.

PwC chief economist john Hawksworth said: ‘if current trends continue, the Chancellor should have some room for manoeuvre in his Budget in March, particularly in terms of increasing planned infrastructure spending.’

But with the national debt at £ 1.82trillion – or more than £70,000 per household – the Government is under pressure to make every penny of extra spending count.

archer added that he believed javid would have increased spending even had the borrowing figures been disappointing.

‘The Budget on March 11 looks likely to further loosen the fiscal strings as the Conservative party looks to cement support in the traditionally Labour seats it gained in the election,’ he said.

‘in particular, the Government has pledged to spend big on infrastructure to take advantage of record low borrowing costs, and it looks primed to boost investment in infrastructure in traditionally Labour regions, pledging to “level up” economic performance in struggling towns.’