Investor confidence is still struggling to recover from the Russian invasion of Ukraine a year ago, according to Hargreaves Lansdown PLC (LSE:HL.).
While its index showed a 14% rise in confidence in February compared to the previous month, it is still 4% lower than it was at the same point in 2022.
Meanwhile, confidence in UK economic growth has jumped 118% since a low in September 2022, when the Trussenomics mini-budget was announced.
However, confidence is still 37% lower than it was before the invasion of Ukraine, according to the HL Confidence Index.
Commenting on the survey, Susannah Streeter, head of money and markets at Hargreaves Lansdown, said that the human and economic costs of the war in Ukraine have been devastating.
The invasion set off a chain reaction, with commodity prices soaring as supply chains were disrupted.
As a result, workers demanded higher wages, pushing up inflation and forcing central banks to hike interest rates, squeezing budgets further.
While the FTSE 100 has rebounded since the start of the conflict, rising to close to record levels, investor confidence remains defensive in nature, with investors seeking safety, security and steadier income.
Streeter said that the optimism in the UK economy is still around a third lower than it was immediately before the invasion and that many believe the ripple effect of the war is still holding back Britain's recovery.
Volatility is set to remain a feature of stock markets this year, as investors continue to worry about the impact of high prices.