Sentiment among Britain’s business and professional services firms has climbed to its highest level since August 2024, marking a significant improvement after more than a year of declining confidence, as reported by Reuters.
A quarterly survey by the Confederation of British Industry (CBI) showed optimism in the business and professional services sector rose sharply to -3 in February from -50 in November. Although still slightly negative, the reading signals a marked easing of pessimism across key parts of the services economy.
However, the outlook remains subdued for consumer-facing businesses. The CBI reported that optimism in consumer services stood at -45, only a slight improvement from -47 in November, reflecting continued pressure on household spending.
“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.
Separate data from the British Retail Consortium (BRC) offered a more encouraging sign, showing consumer sentiment at its highest level since June 2025. Still, BRC Chief Executive Helen Dickinson cautioned that confidence remains fragile amid slow economic growth and rising unemployment.
The mixed signals come as the Bank of England recently downgraded its 2026 growth forecast to 0.9% from 1.2%. Britain’s unemployment rate remains close to a 10-year high, and wage growth has slowed after several years of rapid increases.
Businesses are also closely watching upcoming fiscal updates from Finance Minister Rachel Reeves. Although Reeves has indicated no new tax changes are planned, concerns persist over recent employment legislation and regulatory burdens, which firms say are increasing the cost of doing business.
The CBI survey was based on responses from 351 firms collected between late January and mid-February, while the BRC figures came from a poll of 2,000 adults.
Despite ongoing challenges, recent purchasing managers’ data suggests business activity has begun to recover since the start of the year, offering cautious hope that Britain’s services sector may be stabilising after a prolonged downturn.
