British business confidence hits eight-month low
Confidence among British businesses has slumped to an eight-month low in May as firms worry over their prospects, according to a survey.
The latest Lloyds Bank Business Barometer showed o verall business confidence plunged to its lowest level since last September, with a net balance of 27% marking a sharp reversal of the 17-month high seen in April, when it hit 47%.
The drop came amid growing fears over outlook, with a steep decline in firms expecting stronger business prospects - plunging to 39% from 61% in April.
The report - which surveyed around 200 UK firms with turnover above £1 million - also showed that 13% now expect weaker prospects, up from just 1% last month.
Industrial companies were the most gloomy, with the survey showing sentiment plunged to a net balance of 6% from 56% in April.
These concerns look set to hit recruitment, with a net balance of 19% of firms expecting to expand their workforces over the coming year, down from 37% in April.
But the survey showed optimism over the wider economy remains fairly robust, with a net balance of 28% down only moderately on the 34% recorded last month and remaining above the long-term average.
This comes despite official figures showing growth nearly stalled at 0.2% in the first quarter.
Hann-Ju Ho, senior economist for Lloyds Bank Commercial Banking, said: " Although we have seen a drop in overall business confidence from last month's elevated level, it is only slightly below the long-term average.
"The June survey will provide a more complete picture for the quarter, but the results from our survey so far still point to a pick-up in growth after the 0.2% out-turn in the first quarter."