Business confidence 'remains subdued', report says

A report carried out by the Institute of Directors (IoD) has revealed that business confidence remains 'subdued' as cost pressures on firms intensify.

4 Aug 2026

A report carried out by the Institute of Directors (IoD) has revealed that business confidence remains 'subdued' as cost pressures on firms intensify.

The business group's Economic Confidence Index, which measures optimism amongst business leaders in regard to prospects for the UK economy, fell to -63 in July 2026 from -61 in June.

Business leader confidence in their own firm also fell to -2 in July from +7 in June.

Revenue expectations fell to +9 from +11 - the lowest reading in 2026.

Commenting on the data, Anna Leach, Chief Economist at the IoD, said: 'Our latest data signals a further modest deterioration in sentiment and trading conditions in July.

'Overall confidence in the economy has drifted down a little further amongst business leaders, continuing its trend of weakness and volatility since the 2024 Budget.

'Meanwhile revenue expectations have dropped to their weakest level in 2026, and alongside elevated costs, means the squeeze on margins has intensified.'