Business confidence in the UK has reached a record low, according to analysis by the Institute of Directors (IoD). The IoD’s survey of optimism among business leaders revealed a drop to minus 74 in September, down from minus 61 the previous month. Anna Leach, IoD’s chief economist, said business confidence “plumbed new depths in September.” She added: “Persistent fears that taxes on business and assets will rise are stifling confidence, holding back investment and threatening growth and living standards.” The IoD found that 83% of the 588 chief financial officers surveyed expect staff to be the main factor driving costs higher in the year ahead. Nearly a third said they expect to cut jobs over the coming year.

Business confidence in the UK has reached a three-year low, according to analysis from ICAEW. In London, confidence has declined for four consecutive quarters, with 57% of firms citing tax burdens as a significant challenge. Chief executive Alan Vallance highlighted that productivity has stagnated for 15 years, exacerbated by rising costs and skills shortages. He has urged policymakers to commit to no business tax increases during this Parliament.

London has fallen to 23rd in a global ranking of IPO destinations. This comes after just £184m was raised on the London Stock Exchange in the first nine months of the year. In the same period, around £40bn was raised in the US. The slowdown in the UK comes amid a listings drought across Europe, with Sweden the only country that saw more than £1bn raised. Neil Wilson, UK investor strategist at Saxo, said: “It’s a desert out there,” adding that he had heard London described as a “car boot sale with just crumbs of secondary placements and small capital raisings.”

Office for National Statistics data shows that UK households saved 10.7% of their disposable income in the three months to June, with this a 0.2 percentage point increase on Q1.

The Financial Conduct Authority (FCA) will ease strict new consumer rules after Chancellor Rachel Reeves urged the City watchdog to reduce red tape. Ms Reeves had urged the regulator to cut “complex and burdensome” rules in a bid to stimulate Britain’s economy and encourage risk-taking in the City. FCA chief executive Nikhil Rathi said rolling back some of the consumer duty reforms introduced in 2023 would ease the regulatory burden on businesses. The changes will see a relaxation of consumer duty rules for banks and stockbrokers that deal with professional traders. Mr Rathi said the FCA is “committed to ensuring the UK maintains its position as one of the most competitive and compelling places in the world to start, grow and operate a financial services firm.” UK Finance and the Association for Financial Markets in Europe have welcomed the FCA’s proposals, saying they will “reduce uncertainty, support innovation and help maintain the UK’s global competitiveness, while delivering positive outcomes for consumers.”

Business Secretary Peter Kyle has vowed to ease the red tape holding back the UK economy. Suggesting that “there are some absurdities in regulation,” he said that ministers will reduce the regulatory burdens firms face by 25%. Warning that deregulation brings risks for the Government, Mr Kyle told a fringe event at the Labour party conference: “It’s a risk getting rid of stuff. But there is a second risk, and that is the risk of doing nothing.” He added: “Over time, the economy just gets weighted down. It just gets burdened.”

People in their 20s must save £3.1m for a comfortable retirement, according to a study by Rathbones. This figure, which is more than double the current estimate of £1.4m, reflects the impact of inflation on savings. A 25-year-old would need to save about £1,600 monthly to reach this goal, assuming a 5% annual growth rate. Rebecca Williams, financial planning lead at Rathbones, said the £3.1m figure “is shocking and serves as a stark reminder of how inflation can quietly erode retirement savings.”

While the Chancellor has reaffirmed a commitment to not raise the headline rates of income tax, VAT, or National Insurance, her warning of “harder” choices ahead as the Budget nears has seen economists speculate on potential changes to property tax, ISAs, or pensions. Analysts have also noted that while income tax will not be rising, a stealth raid may still hit taxpayers, with it suggested that Rachel Reeves could extend the freeze on the income tax personal allowance. Analysis shows that adding two years to the freeze – which holds the personal allowance at £12,570 and is currently due to be lifted in 2028 – would see basic-rate employees pay an extra £140 a year and would raise £7.5bn for the Treasury. Calculations from the Institute for Fiscal Studies show that the existing freeze, rolled out in 2021, will reduce household incomes by an average of £1,250 by 2025/26.

Tax hikes and wage pressures are pushing UK firms to consider automation and offshoring, according to Tom Way, chief executive of Hays UK and Ireland. He says that rising costs have made Britain less attractive for permanent hires, noting that recent increases in employer National Insurance and the minimum wage have compounded these issues.

The UK economy grew by just 0.3% in the second quarter of the year, according to the Office for National Statistics (ONS). This figure marks a decline from the 0.7% growth recorded in the first quarter. Over a one year period, the economy grew slightly higher than expected, expanding by at 1.4%. Economists at PwC have said economic growth is “subdued but not stalling,” predicting that UK GDP is on track to grow by 1.3% in 2025, with this driven by a stronger than expected H1. The ONS figures also show that business investment rose by 3% between April and June.

Sarah Breeden, the Bank of England’s deputy governor, says that although inflation has held at around 4% for much of the last six months, this “hump” is unlikely to extend into 2026. She said: “I do not see evidence that the disinflation process is veering off-track. Instead it remains my central case that the hump will prove just a bump in the road.” Ms Breeden also warned that keeping interest rates too high could drag inflation below the Bank’s 2% target, suggesting that “holding policy too tight for too long comes with costs to output and employment.”