UK business leader confidence sinks to 18-month low - IoD
By Caoimhe Toman
Date: Thursday 27 Dec 2018
(Sharecast News) - UK business confidence has dropped to its lowest level since the 2016 Brexit referendum as concerns of a no-deal divorce grow, the Institute of Directors said on Thursday.
Confidence grew briefly after the government revealed there was an agreement with the European Union on a Brexit transition period but has been falling since April and has hit its lowest level this month.
Areas such as Scotland and London, where a high number of people voted to remain in the EU, were the most pessimistic.
IoD economist Tej Parikh said there was no doubt the Brexit uncertainty was having a negative effect on firms' outlooks. Around 60% of leaders expect a slowdown in the economy.
"Business leaders are looking ahead to the new year with trepidation about the economy," he said.
"While we saw cautious optimism emerging when the Brexit talks appeared to be moving towards a transition period after March 2019, that has utterly dissipated now.
"The prospect of a no-deal in the near future will be weighing heavily on directors' minds."
This will be the third quarter in a row where business leaders' confidence in economic growth has fallen, although they remain positive about their own companies.
Optimism levels for economy stood at -38% in December, it said, but the corresponding level for respondents' own companies was +30% (down 1% from a year ago).
Recently the Bank of England said it was expecting a 0.2% increase in GDP for the final three months of 2018 and forecasting a similar rate for the first quarter of 2019.
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