The UK's business confidence has dropped to a 13-year low, according to a survey conducted by the Institute of Chartered Accountants in England and Wales (ICAEW).

The ICAEW's latest Business Confidence Monitor (BCM) showed that record high inflation and rising costs, including energy and the cost-of-living crisis, have adversely affected business confidence.

The latest monitor showed confidence had fallen to -23.4 for Q1 2023, the lowest since the global financial crisis of 2009. This has dropped considerably when compared to -16.9 for Q4 2022.

Most sectors have shared this decline, with construction, property, retail and wholesale and manufacturing the least confident. Annual growth in domestic sales was slowest in the manufacturing and engineering (3.9%) and retail and wholesale (4.8%) sectors.

Michael Izza, Chief Executive of the ICAEW, said:

'Financial challenges have had a big impact on certain sectors and across the board investment is set to fall over the next year, but it is notable that sentiment could be starting to level off.

'With confidence at a decade low, it's time for the Chancellor to outline his long-term vision for growth for Britain, injecting resilience into the economy and bringing in a period of renewal for the future.'