Vaccine news leads to surge in London business confidence: Lloyds
London business confidence increased following the news a Covid-19 vaccine may soon be a reality.
According to the Lloyds Bank’s Business Barometer for 2020, overall confidence of firms in London rose five points in November to -19 per cent.
Firms’ confidence with their own business prospects was -18 per cent, compared to -16 per cent in October.
This increase in UK business confidence was observed after the announcement on the 9 November that the Pfizer and BioNTech vaccine was 90 per cent effective against Covid-19.
However, 23 per cent of businesses are expected to reduce their staff over the coming year, up by three points from October.
Mark Amis, regional director for London at Lloyds Bank Commercial Banking said: “It’s encouraging to see a slight rise in business confidence among the capital’s firms, especially against the backdrop of national lockdown measures, which have dampened optimism about trading prospects during November.
“The city region’s hospitality and retail industries are now gearing up to welcome customers back at what would usually be one of their busiest times of the year and we hope this will buoy confidence levels next month,” he added.
Meanwhile, encouraging vaccine developments continue to add hope that trading prospects will increase for London businesses next year, Amis continued.
Barometer
The Lloyds Bank’s Business Barometer questions 1,200 businesses every month, including 145 firms in London, and provides early signals about UK economic trends regionally and nationwide.
The North East of the UK had the highest confidence in November at -eight per cent, closely followed by Yorkshire and the Humber at -11 per cent, and Wales at -15 per cent.
Scotland was the UK’s least confident region, business optimism falling 10 points to -38 per cent.
The main industry sectors that saw a decline in confidence, as a consequence of stricter lockdown measures imposed nationally last month, were manufacturing, which fell 10 points to -25 percent, construction, falling 13 points to -23 per cent, and retail, falling five points to -23 per cent.
However, services confidence increased by three points to 21 per cent.
Hann-Ju Ho, Senior Economist at Lloyds Bank Commercial Banking said: “Firms across the sectors also continue to remain cautious as they prepare for a new trading relationship with the EU.”