British businesses are displaying their highest level of confidence in eight years, with the strongest hiring intentions since 2017, a recent survey revealed.
The findings, which come as a national election looms, indicate a possible resurgence in the economy.
The Lloyds Bank Business Barometer, which surveyed 1,200 firms between May 1 and May 16, showed an increase of eight points, reaching 50% in May—its peak since November 2015.
This surge in confidence is partly due to reduced inflation and the anticipation of decreased interest rates.
The survey also highlighted the highest economic confidence since September 2021, reflecting growing optimism among companies about their future prospects.
Despite this, businesses are still wary of inflationary pressures, which are closely monitored by the Bank of England as it debates rate cuts.
According to the report, an increasing number of businesses expect to raise their prices, marking the second consecutive month of such expectations.
In the broader economic landscape, the UK recently overcame a brief recession in early 2024.
However, this recovery has yet to bolster support for Prime Minister Rishi Sunak and his Conservative Party, which continues to struggle in opinion polls ahead of the July 4 election.
Additionally, a survey from the Recruitment and Employment Confederation, encompassing the three months leading up to April, indicates a rise in employer confidence.
This sentiment is the most positive observed in two years concerning the economic outlook.
The survey also noted significant increases in both investment and hiring plans among employers.
These positive indicators from the business sector suggest a potential shift in economic dynamics as the country prepares for upcoming elections, although the political benefits for the current government remain uncertain.