Echoing the pessimistic figures revealed in March, the bank found that the percentage of UK firms reporting an increase in business activity fell again in April, reaching 48 per cent.

The fall, from 61 per cent in February, is due to a combination of factors, including increasing concern about the slowing world economy, weakness in the UK major export markets, rising oil prices and slowing consumer spending, according to Lloyds TSB Financial Markets.

“This continued drop in confidence is undoubtedly caused by concern over economic growth in the wider economy, higher oil prices and a slowing global economy; all exacerbated by last month’s pre-election jitters over higher business taxes at a time when costs are rising,” said Trevor Williams, chief economist at Lloyds TSB Financial Markets.

“In addition, slowing house prices and weaker retail sales growth have heightened fears of an unrelenting slowdown in consumer spending, hitting domestic sales at a time when major export markets, such as Europe and the US, are weakening.”

Business and financial services sector firms showed the greatest optimism in the Lloyds TSB barometer, with 63 per cent reporting an increase in sales confidence.

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