London Business Confidence Rebounds in May

30 May 2025

Justin Ng/Avalon

LONDON - In May 2025, business confidence in London experienced a notable resurgence, rising by 10 points to 53%, according to Lloyds Bank's latest Business Barometer. This increase reflects growing optimism among companies regarding their own business prospects and the broader economic environment.

Companies in London reported an eight-point increase in confidence about their own business prospects, reaching 57%. Simultaneously, optimism about the economy rose by 12 points to 48%. These figures contribute to the overall headline confidence reading of 53% for the region.

Looking ahead, London businesses have identified key areas for growth over the next six months:

1 Evolving their offerings

2 Investing in their teams

3 Introducing new technology

4 Entering new markets

Nationally, UK business confidence increased by 11 points in May to 50%, marking its highest level since August 2024. The East Midlands and North East regions reported the highest confidence levels at 66% and 65%, respectively.

Sector-wise, the construction industry saw confidence rise to a nine-month high of 56%, while the service sector reached a one-year high of 54%. Manufacturing confidence also improved by two points to 40%. However, retail confidence declined by five points to 40%, the lowest since January of the same year.

Kirsty Sadler, regional director for London at Lloyds, commented on the findings:

"It’s encouraging to see strong growth in business confidence across the capital this month. The renewed optimism – not only in their own trading prospects but the wider economy – reflects the ambition, adaptability, and forward-looking mindset that continues to define London’s business community. We remain committed to supporting local firms as they harness this momentum to innovate, grow, and invest in their future."

This rebound in confidence suggests that London businesses are positioning themselves for growth, focusing on innovation, workforce development, and market expansion in the coming months.