A surge in confidence amongst businesses could signal that the UK’s debt problems are at an end, according to research.
A study by the Institute of Chartered Accountants in England and Wales (ICAEW), found that optimism among professionals soared in the third quarter, to the highest levels in two years when the financial crisis began.
The confidence measure rose from -28.2 in March to 4.8 at the end of June this year, marking the biggest increase since the records were first established in 2003.
The ICAEW also predicted that the economy should grow by half a per cent this quarter, breaking the pattern of the previous five quarters of falling output.
Michael Izza, ICAEW chief executive, hinted that the findings suggest the UK recession could be at an end.
He said: “While there is no doubt that the UK economy is on its way to recovery, we shouldn’t underestimate the challenges ahead for businesses.”
Ivan Cooper, Chairman at debt management specialists Chiltern, added: “For many people currently suffering with debt problems, this news couldn’t come sooner.
“Hopefully this confidence will filter down and assist the flailing property and jobs markets, and more people can stop worrying about their financial situation.”
The ICAEW survey showed that UK businesses expected a rise in all but one of 14 key financial performance indicators in the coming year, in contrast to earlier in the year when most were expected to contract.
The research found that 41% of senior business professionals were more confident about the economic prospects their business’ face in the coming year. However, only 6% were much more confident, indicating a continued level of caution over the timing and speed of the recovery.
