Brexit victory and confidence in UK economy hit eight-year high | United Kingdom | News

Business confidence rebounded sharply in July as companies felt renewed optimism about Britain’s economic outlook.

According to Lloyds Business Barometer, overall business confidence jumped nine points to 50% this month. The boost in confidence in July brought business confidence back to May’s level, which was the highest since the Brexit referendum.

Businesses reported a much better business outlook, with 62% reporting stronger activity, up from 53% in June. And 62% of respondents feel more confident about the economy.

This figure is up from 55% previously. Hann-Ju Ho, senior economist at Lloyds commercial bank, said: “This month, businesses are feeling more confident, supported by their positive business and economic outlook.

“Retail-focused businesses were the main driver of the positive increase in business outlook and these results are consistent with the improvement we have seen in consumer confidence.”

The rapid rebound in confidence after June’s slump suggests that the slowdown may be due to temporary factors, such as election uncertainty. If the rebound continues, the survey suggests that the UK’s surprisingly good performance so far this year could continue.

Paul Gordon, managing director of customer relationship management at Lloyds, said increased confidence would help “drive innovation and create jobs across all sectors” in the coming months. The Lloyds survey is another positive indicator of the economy heading into the second half of the year.

The UK grew the fastest among G7 economies in the first quarter of the year and most economists expect strong growth in the second quarter as well. Households are seeing healthy real wage gains thanks to falling inflation, while interest rate cuts are also on the horizon. This should help support consumer spending.