London, United Kingdom. Sentiment in Britain’s business and professional services sector became markedly less negative in the current quarter, ending more than a year of declines, while consumer-facing businesses remained downbeat, a survey showed on Thursday.
CBI survey points to improved business services outlook
The Confederation of British Industry’s quarterly services sector survey showed that optimism for business and professional services businesses rose to -3 in February from -50 in November, its highest reading since August 2024.
Optimism for consumer services businesses stayed deeply negative at -45, improving only slightly from -47 in November.
“With little sign of improvement in consumer services, overall momentum is likely to remain weak – weighing on investment and employment prospects,” said Charlotte Dendy, the CBI’s economic surveys and data manager.
Retail group data shows uptick in consumer sentiment
Separate figures from the British Retail Consortium, also released on Thursday, indicated some prospect of a recovery as consumer sentiment rose to its highest since June 2025.
“The lift in confidence is encouraging, but fragile. Slow growth and rising unemployment still weigh heavily on the economy,” BRC Chief Executive Helen Dickinson said.
Economic backdrop includes weaker growth outlook and labour market strains
Earlier this month, the Bank of England downgraded its growth forecast for 2026 to 0.9 per cent from 1.2 per cent, and on Tuesday finance minister Rachel Reeves will unveil fresh forecasts from the government’s Office for Budget Responsibility.
Unemployment is close to a 10-year high and wage growth is slowing from rapid rates in recent years.
However, purchasing managers’ data has shown a pickup in business activity since the start of the year, and a fall in inflation back to target in April is widely expected to limit the impact on living standards.
Past budget statements from Reeves have weighed heavily on business sentiment, especially after she announced a big rise in employment taxes in October 2024.
How do you think the gap between business services optimism and consumer services pessimism will affect hiring and investment decisions?
