Business confidence fell to 36% in September after the surge to an 18-month high of 41% in August, a survey showed today.
The Lloyds Bank Business Barometer for September said the fall was a result of pullbacks in firms’ assessment of both their trading prospects for the year ahead and optimism regarding the wider economy.
From a sector perspective, the decline centred in retail and services, while outcomes for manufacturing and construction were mixed.
Regionally, only three areas – Yorkshire & the Humber, the East Midlands and the North West – reported higher confidence this month.
In tandem with the broad sentiment slide, hiring intentions were reined back compared with last month, although firms continued to attach high priority to attracting and retaining staff.
Hann-Ju Ho, economics & market insights analyst at Lloyds Bank, said: “While the gains in business confidence we saw in August have not been maintained, it’s important to see the wider trend clearly reflected in the data which paints a very different picture to this time 12 months ago, when the economy was in significant difficulties.”
“Although the economic environment remains uncertain with inflation and interest rate pressures playing their part, the recent decision by the Bank of England to leave interest rates unchanged is likely to help businesses feel more upbeat about the future, which may underpin confidence in the last three months of the year.”