In its latest Quarterly Economic Survey, the business group records increases in most balances and suggests that the economy was able to grow over the first three months of the year, after contracting during the final quarter of 2011.
It comes a week after the Organisation for Economic Co-operation and Development claimed that the UK was already in recession.
But the BCC says it now expects the economy to have grown by 0.3% across the Q1 2012, which is in line with the most recent forecast from the Office for Budget Responsibility. Growth over the whole of 2012 is tipped to be 0.6%, which is lower than official estimates.
Many indicators for the manufacturing sector have reached a “satisfactory” level, the group says. The manufacturing employment balance stands at 16%, which is its strongest since Q4 of 2010, while the balance for export orders gained 15 points to hit 20%.
But the service sector appears to remain “sluggish”, with the employment balance staying at a relatively weak 4%, while service providers intend to invest less than manufacturers in the coming months.
David Kern, chief economist to the BCC, says: “The results of the Quarterly Economic Survey point to a welcome but modest improvement in the economic situation. The UK economy will likely avoid a recession.