Big revision shows UK Q4 business investment rose

British business investment in the final three months of
2007 is now estimated to have risen sharply rather than fallen, revised
official figures showed on Thursday.

The Office for National Statistics said business investment
rose 1.8% in the fourth quarter, taking it up 5.3% on the year. It was originally
reported to have fallen 0.5% on the quarter and risen 1.7% on a year ago.

But economists said it was hard to say whether this would be
enough to lead to an upward revision to fourth-quarter GDP figures when they
are released at 0930 GMT on Friday.

Total investment in the quarter stood at 36.723 bln pounds.

“It still seems highly likely that it will soften
significantly through 2008 in the face of tighter lending conditions, markedly
softer final demand, weakening profitability and lower business confidence
reflecting heightened concerns and uncertainties over the economic outlook,”
said Howard Archer, economist at Global Insight.

Annual business investment growth hit an eight-year high
above 13% in the fourth quarter of 2006 but began slowing last year even before
financial markets were gripped by the credit squeeze.