Businesses knocked by terrorism and economic slowdown

Terrorists
attacks and the world economic slowdown are being blamed for a sharp fall in
business confidence among financial services companies, according to quarterly
findings by the CBI and PricewaterhouseCoopers.

Nearly
half of the companies surveyed are more pessimistic about the business
situation than they were three months ago, compared to 7 per cent that are more
optimistic.

The
balance of minus 40 compares is the lowest since September 1998, and the
research also shows that business levels are at their lowest since 1997 – with
over one-third claiming it is below normal, compared to 19 per cent who believe
it is above normal.

Business
volume has risen slightly over the past four months from minus 2 per cent in
June to plus 4 per cent last month.

"The
sharp slowdown in the world economy has left business confidence suffering,
even before the attacks on the USA. It is significant that financial services
companies are markedly more concerned about future demands than they have been
at any time in the past five years," said Sudhir Junankar, CBI associate
director of economic analysis.

By Paul Nelson

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