Business confidence in the South East rose six points during September to 49%, bucking the national trend and rising above the UK average, according to the latest Business Barometer from Lloyds.
Companies in the South East reported stable confidence in their own business prospects month-on-month, which remained unchanged at 56%. When taken alongside their optimism in the economy, up 13 points to 43%, this gives a headline confidence reading of 49% (vs 43% in August).
Looking ahead to the next six months, South East businesses identified their top target areas for growth as evolving their offering, for example, by introducing new products or services (47%), introducing new technology (44%) and entering new markets (36%).
The Business Barometer, which surveys 1,200 businesses monthly and which has been running since 2002, provides early signals about UK economic trends both regionally and nationwide.
Overall, UK business confidence fell 12 points in September to 42%. Firms’ confidence in their own trading prospects fell 12 points to 51%, and their optimism in the wider economy fell 11 points to 33%.
The North East was the most confident UK nation or region in September, climbing 13 points to 68%, followed by London (57%).
Firms across manufacturing, construction, retail and services all saw confidence fall this month. The biggest change was in manufacturing with a decline of 31 points to 31%, a two-year low.
Retail sentiment fell 17 points to 40%, its lowest level in four months. Similarly, confidence in the service sector fell six points to 47%, the lowest reading since April. Construction continued to decline for the fourth consecutive month, dropping 5 points to 35%.
Amanda Dorel, regional director for the South East at Lloyds, said: “Confidence is rising in the region once again. Local firms will be looking to translate this outlook into action – pressing ahead with their plans for growth, whether that’s launching new products or entering new markets. We’ll continue to support them every step of the way.”
Hann-Ju Ho, senior economist, Lloyds Commercial Banking, added: “While increased market volatility earlier in the month may have impacted confidence, levels of trading prospects and economic optimism remain above their long-term averages.
“Businesses may find reassurance that the Bank of England is expected to reduce interest rates further in the next six months, while long-term global bond yields have calmed, which, if sustained, may have a positive impact on businesses as we move into the last few months of the year.”
