Overview
- Lloyds’ Business Barometer eased to +44 in January from +47, as net economic optimism fell 14 points to +28, the lowest in a year.
- Expectations for firms’ own trading rose seven points to +59, signaling resilience in company-level plans despite softer headline sentiment.
- Hiring plans strengthened for the first time in three months, and just over one in five firms expect pay to rise by 4% or more.
- Lloyds linked weaker macro views to January geopolitical tensions, including tariff threats by President Donald Trump, and to concern over potential tax rises in Rachel Reeves’ budget.
- Confidence remains above its +30 long‑run average and higher than a year ago, with other signals mixed, including a modest PMI pickup and a 10% year‑on‑year rise in Q4 2025 business registrations.