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Businesses show flicker of confidence after post-Brexit vote slump

Published 31/08/2016

Business confidence dropped in August but was up on the levels seen immediately after the Brexit vote, according to the Lloyds Bank index
Business confidence dropped in August but was up on the levels seen immediately after the Brexit vote, according to the Lloyds Bank index

Business confidence has shown signs of recovery from the slump seen in the immediate aftermath of the Brexit vote, a report has revealed.

The Lloyds Bank business barometer found that UK business confidence dropped by 13 points to 16% in August, but remained higher than the reading taken in the days after Britain's voted to leave the European Union.

It said the net balance for companies expecting trading to improve slipped to its lowest level since December 2011, falling 22 points to 19% in August.

But despite concerns over trading, businesses are still keen to take on staff, with the net balance of companies expecting to boost their workforce hitting a five-month high of 33%.

Hann-Ju Ho, senior economist for Lloyds Bank Commercial Banking, said: " It is consistent with a slowdown in UK growth prospects in the second half of the year and may reflect a growing expectation for some that a more challenging economic outlook will have a negative impact on their own company prospects. Despite this, hiring plans continue to indicate resilience."

The report comes as separate study published on Friday showed that c onsumer confidence had risen at its fastest monthly rate in three-and-a-half years.

In a dramatic turnaround from last month, the YouGov/Cebr Consumer Confidence Index has seen its highest monthly bounce since February 2013 of 3.2 points to 109.8.

The poll reveals significant increases in people's expectations for their household financial situations and property values over the coming year.

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