Business confidence dips, recovery 'gradual'
Business confidence falls for second consecutive month, Lloyds TSB survey says
Monday, 16, Nov 2009 11:05
Business confidence fell for the second consecutive month, with experts saying they expect economic recovery to be "gradual".
The Lloyds TSB business barometer for October found firms' views of the economy remain stable, with confidence levels markedly higher than early 2009.
However, business confidence dropped two points last month, to its lowest level since June, despite the overall trend being much higher than last year. The balance of firms expecting business activity to improve slipped two per cent to 27 per cent - 38 per cent reported higher confidence levels, while 11 per cent reported lower confidence.
Trevor Williams, chief economist at Lloyds TSB corporate markets, said: "Business confidence has recovered sharply from the lows at the turn of the year, however it is still below its long term average.
"But current levels of business confidence are consistent with a recovery in economic growth, albeit a gradual one."
Across the regions, the Lloyds survey presents a mixed picture. In the south, there was an 11 per cent increase in confidence amongst businesses, but in the Midlands, confidence fell markedly - by 16 per cent, to just 15 per cent. Confidence levels slipped in the north too, by four per cent.
Confidence levels amongst industrial firms jumped 21 per cent to 40 per cent, but distribution firms, including retailers, suffered a drop in confidence and services businesses showed a 13 per cent decline to 27 per cent.