By Ben Kerrigan-
Business confidence in Britain has been dragged to a four-year low amid rising concerns over economic uncertainty and a slowdown in demand following the EU referendum result.
Expectations of growth in sales, orders and profits over the next six months slipped to 12%, down from 38% in January, according to Lloyds Bank’s Business in Britain report.
Economic uncertainty was cited as the main threat to growth over the next six months, while 18% said the biggest danger came from a drop in demand.
The outlook for demand, employment and investment has weakened across all sectors, the report said. Confidence in services fell sharply by an average of 30 points in retail and wholesale, hospitality and leisure, and business and other services. Pessimism in business confidence since January has occurred in the context of recent economic and political shocks.
“The EU referendum vote has introduced a level of uncertainty for companies as the UK decides on the best model for its future relationship with the EU, and this is likely to continue for the foreseeable future.
“Whilst sentiment has fallen to a four-year low, it remains well above the lows reached during the global financial crisis of 2008-9.”
The British pound fell to a 31-year low, following Britain’s vote to leave the EU, and has made UK goods more competitive on the global market, boosting exports in the process. Employment has also been hit by downward pressure , as a number of employer firms less inclined to recruit more staff over the next six months to a year.
The current climate between the U.K and EU leaders has done very little to improve business confidence either, as many firms decide to relocate in anticipation of gloom and doom, or sheer risk aversion in order to avoid any serious losses.