British business confidence at new low

Confidence among British firms has plunged to a new low in the wake of the economic downturn, according to a study today.

A survey of more than 200 firms last month by Lloyds TSB showed almost one in four feared their business activity will fall over the next year, with fewer than one in three confident that things will improve.

The balance of 8% was the lowest since the bank launched its business barometer six years ago and represented a huge dip in confidence since August.

More than two thirds of those polled said they were more pessimistic about future trading prospects than three months ago.

Trevor Williams, chief economist at Lloyds TSB Corporate Markets, said: "With business confidence at rock bottom, the crucial question is what will help firms regain faith in their own prospects and in the wider economy?

"One reason for hope is falling interest rates. If it is true that inflation has now peaked, the chances are that the Bank of England will be able to trim rates even further before too long. That would help ease the cost of borrowing for firms and homeowners, which would in turn encourage higher levels of spending.

"In addition, a weaker currency may in time help export firms to become more competitive, though that also depends on growth in overseas markets. It is developments like these that are needed to set the economy back on an upward path."

Service firms were most hopeful of an upturn in future business activity, while companies in the North of the UK were more upbeat than those in other parts.

More in this Section

Almost two thirds of employers expect to make more pay cuts - surveyAlmost two thirds of employers expect to make more pay cuts - survey

Markets buoyed by slim manufacturing improvementMarkets buoyed by slim manufacturing improvement

UK lines up insurance firms for Covid compensation test caseUK lines up insurance firms for Covid compensation test case

Hotel enquiries jump after July 20 set for reopening in Northern IrelandHotel enquiries jump after July 20 set for reopening in Northern Ireland


Bless me readers, I have sinned. This week, we had more than a few visitors around, some water was wasted in the back garden and I was judgmental about my friends’ parenting style.Learner Dad: The highlight was when my daughter roared, ‘this is just like being on holidays’

Wearing gloves when out in public has become more prevalent and so has pulling them on in the garden during lockdown, writes Ray RyanIreland's growing love for gardening

Dublin songstress, Imelda May.Imelda May returns with spoken word album Slip Of The Tongue

Tackling skin pigmentation requires patience, but it doesn’t need to be difficult.The Skin Nerd: What should be my first step towards lightening age spots?

More From The Irish Examiner