Research from Deloitte has revealed that business confidence among chief financial officers has seen its sharpest since 2020, jumping by 8 per cent amidst the aftermath of the Spring Budget.
The survey showed that 25 per cent of chief financial officers were feeling better about the future rather than worse which has risen from 17 per cent three months ago.
The results highlight that feelings among businesses are taking a U-turn as concerns around macro issues such as energy prices and Brexit problems are easing as the state of the economy improves.
The CFOs who were interviewed were predominantly from big companies, and, despite the shift in mood, many are still looking to avoid risk by prioritising things such as cutting costs and building up cash reserves as they prepare for the future.
Khalid Talukder, Co-Founder of DKK Partners, said: “It is fantastic to see businesses regain confidence in themselves, and the economy, as the UK rebounds and avoids the predicted technical recession, fuelling business chiefs with optimism. Businesses have taken continued hits over the last few years and recently, due to inflation, higher interest rates take hikes and pulled budgets towards the back end of 2022, their confidence took a beating.”
“As the economic position of the UK appears less bleak than initially imagined, business owners can look to a brighter future and get back out to the marketplace after a turbulent few years. A growing economy will empower businesses with the confidence they need to re-engage with normal business operations, and for the economy, this is great news as SMEs act as the backbone and play a vital role in continued growth. While this is positive news, we must still be cautious as the risk of a recession is not completely disregarded, however, businesses can remain optimistic as positive steps continue to be taken towards economic recovery.”
Hywel Ball, EY’s UK chair, said the economy “seems to be turning a corner, albeit very slowly” but added that the challenges “haven’t gone away overnight”.
“Inflation is still in double-digits and energy prices remain historically high… However, perceptions matter and the fact the economy has been able to outperform expectations could help stir a revival in business and consumer confidence.”
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Business confidence sees sharpest rise since 2020