The latest Economic Confidence Index from the Institute of Directors has recorded its lowest ever reading for March, with optimism at -76, down from -63 in February, with 71 percent concerned about geopolitical tensions affecting investment, markets or partners.

The confidence business leaders expressed in their own organisations also fell from +1 to -2 over the same period, as 59 percent of firms state that the conflict in the Middle East has had a negative impact on their organisation.

“The outbreak of conflict in the Middle East has driven down the confidence of business leaders to a new record low,” said the IoD’s chief economist Anna Leach. “Manufacturers are at the sharp end, with 69 percent reporting a negative impact so far. 

“Impacts being reported include sharp increases in fuel and shipping costs, rising material prices – such as petrochemicals – and delivery delays. Across all sectors, the general increase in uncertainty is once again delaying decision-making, as many wait to see how the conflict evolves.”

Cost expectations rose to +88 in March from +84 in February, the second highest reading on record – after +89 reported in September 2025 – while investment intentions fell to -13 from -6, continuing a negative trajectory first established in August 2024.