Business to continue to suffer from weak prices

UK economic newsflow has been reasonably positive for the most part, according to Gerrards, but a question mark hangs over whether corporate earnings will rebound in 2003. Gerrards chief economist Simon Rubinsohn says the key problem for business at present is the general lack of pricing power. Because of this, any rebound in corporate earnings must be made through cost-cutting. He adds: 'This statement is, of course, a little misleading to the extent that there are big areas of the economy in which companies are able to push up prices. But in aggregate it remains pretty tough.' ...