Growth to remain 'sluggish' in 2011

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Business growth is likely to be "sluggish" at best this year after economic recovery in private firms lost momentum in 2010, according to the Federation of Small Businesses.

Its survey of more than 1,500 firms showed that the severe weather last month coupled with the increase in VAT at the start of the new year had an impact on business confidence, especially on restaurants, and retail and transport sectors.

Confidence fell for three successive quarters to the end of 2010, said the FSB, which called for interest rates to be held at 0.5 per cent. The FSB's chairman John Walker said: "Small firms cannot rely solely on the consumer for growth in 2011."