Business confidence falls for second month in a row, research suggests

Business confidence in Scotland as fallen for the second month in a row, new research suggests.

The latest barometer from Bank of Scotland found optimism fell from 7% to 4% for October.

Economic confidence has also dropped, with 9% of firms saying they are pessimistic – compared with a net balance of 1% saying they were hopeful last month.

  • Business confidence: -3 points

  • Economic optimism: -10 points

  • Confidence in business prospects: +5 points

  • Firms expecting to hire: +7 points

Fraser Sime, of Bank of Scotland, said: “Ongoing uncertainty appears to be weighing heavily on businesses’ optimism for the economy across the UK.

“However, it’s slightly more encouraging to see firms reporting growing confidence in their own business prospects and an increase in hiring intentions.

“This suggests a resilience that may prove to be valuable as companies await greater clarity on the UK’s future trading relationship.”

September saw business confidence dip 10 points to 7%.

But companies in Scotland have now reported higher confidence in their business prospects, up five points at 18%.

A net balance of 13% expect to hire more staff during the next year, up seven points on last month.

The Business Barometer questions 1,200 UK firms – 104 in Scotland – each month.

Across the UK, overall confidence fell 10 points to 19%.

This is its sharpest fall and its lowest level all year.

It comes as firms’ optimism about the economy slumped 18 points to just 8%.

Confidence in their own business prospects fell three points to 29%.

Hann-Ju Ho, senior economist, added: “Business confidence is continuing to fall as firms become less optimistic about the wider economy, and is impacted by the mixed rhetoric on the progress being made in the ongoing EU-UK negotiations.”