UK business confidence falls from eight-year high: survey
BRITISH business confidence ebbed slightly this month after reaching an eight-year high in July and August, as concerns about the broader economic outlook rose to a six-month high, a survey from Lloyds Bank showed on Monday (Sep 30).
Lloyds’ overall business barometer – which represents the difference between the percentage of firms with positive and negative views – fell by three percentage points to a three-month low of +47 per cent. Businesses had a brighter view of their own prospects than those of the wider economy.
“The more mixed picture for economic optimism points to some businesses maintaining a degree of caution. While we still expect economic expansion, it may occur at a slower rate than the first half of 2024,” Lloyds economist Hann-Ju Ho said.
Official gross domestic product data due at 0600 GMT is likely to confirm Britain’s economy grew by 0.6 per cent in the second quarter of 2024, capping a stronger-than-expected first half of the year as the country recovered from a shallow recession.
However, earlier this month, the Bank of England trimmed its growth forecast for the third quarter and predicted a quarterly expansion of 0.3 per cent, around Britain’s long-term growth rate.
An S&P Global survey of purchasing managers last week showed a bigger-than-expected slowdown in growth for September, although the index remained well above levels for the eurozone.
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S&P said some businesses were putting investment and hiring plans on hold until there is clarity about the new Labour government’s tax policy and employment law changes.
Labour has said taxes are likely to have to go up by more than it had planned before July’s election, and it is also due to set out legislation to give greater employment protection to staff with less than two years’ service.
The Lloyds survey’s employment balance fell by one point to +36 per cent in September.
The Lloyds survey was based on responses from 1,200 British companies with annual sales of more than £250,000 (S$428,388) and was carried out between Sep 2 and Sep 16. REUTERS
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