UK business confidence plunges

Date: Tuesday 03 Jan 2012

The confidence in the economic outlook among UK business leaders has dived to its lowest level since January 2009, a survey by Lloyds Bank Corporate Markets suggests.

According to the bank's index, which measures the outlook of British companies on the economy, levels of optimism dropped to a three-year low in December, hitting minus 23, 3 points lower than in the previous month.

Lloyds also said there the survey indicates there is a 74% chance of another recession.

In an e-mail report, the banking giant said: "The results indicate that the economy will almost certainly begin the new year with a contraction.

"As this indicator leads quarterly gross domestic product growth by three to four months, it suggests that economic activity will progressively weaken during the first quarter and the start of the second quarter of 2012."

Lloyds also added that there had been a fall in companies' faith in their own prospects, with an index showing perceptions of their own performance over the coming year dropping 14 points to 17 in December.

The Corporate Markets unit consulted with 304 companies, each with sales in excess of £1m, during the first half of December.

NR

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