SCOTTISH businesses are less confident about the economic prospects facing them over the coming year, compared with the preceding 12 months, a survey shows.

The latest confidence reading for Scottish businesses’ view of economic prospects, in the regular survey by the Institute of Chartered Accountants in England and Wales (ICAEW), has remained in negative territory for a fourth consecutive quarter, coming in at -5.1.

However, ICAEW noted the latest confidence reading was not as negative as the -11.9 recorded for the fourth quarter of last year. The movement in the reading signals the pace of decline of confidence has eased.

The ICAEW survey shows there has been 2.4 per cent growth in domestic sales for Scottish businesses over the last year, with a 3.4 per cent increase anticipated by companies in the coming 12 months.

It shows Scottish businesses expect an overall rise in exports of 4.9 per cent over the coming 12 months, an acceleration from 3.2 per cent growth in overseas sales over the past year.

The survey highlights a jump in cost inflation for businesses, especially from the impact of the pound’s fall in the wake of the Brexit vote on food prices and the price of oil in sterling terms. And it flags businesses’ intentions of passing on these higher costs to customers, with sales prices forecast to rise by 1.1 per cent over the coming year after two years of no significant increases.

The survey also shows 23 per cent of businesses are increasingly challenged by the availability of non-management skills, compared with a year ago.