While there is a risk that recent financial market weakness, and the underlying causes, may further affect consumer confidence and credit markets, there is offsetting positive news on petrol prices, other raw materials inflation, interest rate expectations and industry capacity.
The company said it was aiming to absorb a significant proportion of the raw material cost inflation itself.
"You have a red-hot economy and the raw material for inflation," said Alan Kral, who helps manage $800 million at Trevor Stewart Burton & Jacobsen.
While Debenhams has self-help opportunities (space optimisation; operating efficiencies and mark down), we expect these to be offset by material wage inflation and margin reinvestment back into differentiating the offer.
A sharp decline in new car registrations in Europe, rising oil and raw material prices, inflation and a stronger euro are all factors that have contributed to a decline in the automobile industry.
The agencies report that materials cost inflation has "remained negative".
High prices for raw materials, rising inflation and the credit crisis, Daimler added, would almost certainly prevent a significant near-term revival.
This was supposed to encourage domestic production but the result so far has been soaring food prices, companies laying off workers as they suffer shortages of raw materials, rising inflation and GDP growth slowing to 2.1%.
"The influence of high raw material prices, rising inflation rates, falling purchasing power and tight capital markets are likely to prevent a significant revival from taking place in the coming months," the company said.
