Business confidence in Wales rose nine points during June to 32%, according to the latest Business Barometer from Lloyds.
Companies in Wales reported higher confidence in their own trading outlook month-on-month, up 13 points at 48%. When taken alongside their optimism in the economy, up five points to 16%, this gives a headline confidence reading of 32% (vs. 23% in May 2026).
Welsh firms reported strong customer demand (89%) as the key driver of confidence in their own trading outlook.
A net balance of 20% of businesses in the country also expect to increase staff levels over the next year, up two points on last month.
Business confidence in Wales now sits below the 12-month average of 42%, with its highest figure of 76% in July last year.
Looking ahead to the next six months, Welsh businesses identified their top target areas for growth as introducing new technology such as AI or automation (52%), entering new markets (36%) and investing in their team, for example through training (33%).
The Business Barometer, which surveys 1,200 businesses monthly and which has been running since 2002, provides early signals about UK economic trends both regionally and nationwide.
Nathan Morgan, Area Director for Wales at Lloyds, said: “It’s encouraging to see confidence among Welsh businesses rise this month, with firms feeling more positive about their own trading outlook and the wider economy.
“That optimism is being backed by clear plans for growth, with businesses looking to embrace new technology, enter new markets and invest in their teams.
“With hiring intentions also edging up, there are positive signs of momentum across Wales. We’ll continue to support Welsh businesses as they adapt and pursue new opportunities.”
Overall, UK business confidence fell three points in June to 44%.
Firms’ trading outlook fell two points to 56% and their optimism in the economy generally also fell four points to 31%.
The 12-month average for overall confidence is currently sitting at 47% and is trending above the long-term average of 30% since the survey began in 2002.
Despite a modest softening in business confidence due to wider global uncertainty, two thirds of firms nationally (64%) expect stronger output over the year ahead and hiring intentions for the coming twelve months strengthened for the first time since March.
The share of firms planning to increase their workforce rose to 55%, while 14% anticipated headcount reductions, leaving the net balance up five points at 41%. Firms intending to hire cited the need to meet strengthening demand and expand capacity, pointing to a degree of confidence in near-term activity.
Business confidence rose across six of the twelve UK regions and nations in June, with the South West seeing a 22pp jump to 44%, and the East Midlands becoming the most confident region with a headline confidence reading of 56%.
Amanda Murphy, CEO for Lloyds Business and Commercial Banking, said: “Confidence has edged down this month, and that reflects what we’re hearing directly from businesses. Many are still dealing with a mix of higher costs, uncertain demand and a wider global backdrop that feels difficult to read.
“That is weighing on decision making, particularly for firms that are focused on the UK market and have fewer ways to offset those pressures.
“However, this is not a picture of businesses stepping back altogether. Trading outlook remains relatively steady and we continue to see firms looking for new opportunities, even if investment plans have become more cautious.
“Businesses have shown over time that they can adapt in tough conditions, but for many the priority is managing costs and maintaining stability rather than pushing for growth?”
