Confidence fell for the sixth successive month in February - 51 per cent of firms said they were more pessimistic about the economy than three months ago and just 28 per cent who felt more optimistic.

The net balance of firms feeling more, rather than less, optimistic was minus 23 per cent – the lowest recorded in the history of the six-year survey.

Trevor Williams, chief economist, Lloyds TSB Corporate Markets, said: “Firms' concern over the wider economy has not been helped by the spate of weakening economic news coming from the housing market and falling consumer confidence.

“Although this year is likely to be a challenging one for many businesses, we expect confidence to improve in the second half and economic growth to accelerate in 2009.”