Confidence at City firms falls as fears over austerity measures take their toll

CONFIDENCE levels held by City businesses have dipped, according to new research, despite firms seeing a general rise in turnover and profits.

The business confidence monitor survey, conducted by accountants Grant Thornton and the Institute of Chartered Accountants for England and Wales (ICAEW), found that confidence amongst London’s businesses has fallen in the last three months as uncertainty over austerity measures have taken its toll.

Ian Strange, ICAEW’s London regional director, said: “Businesses in the capital are now facing the challenge of surviving the recovery. They still don’t know what the future holds and are uncertain about how the mood of fiscal austerity will impact on the economic recovery.”

The survey’s confidence index, which ranks overall responses to the survey, fell from 28.1 points during the last quarter to 25.9 this quarter, indicating that businesses are weary about future growth.

However, the survey also found that 1.7 per cent of London firms saw revenue grow over the year, while 1.5 per cent reported a rise in profits.