Companies in Scotland reported lower confidence in their own business prospects month-on-month, down seven points at 44%. When taken alongside their optimism in the economy, down 14 points to 18%, this gives a headline confidence reading of 31%.

Scottish businesses identified their top target areas for growth in the next six months as evolving their offer (39%), investing in their team (37%), and entering new markets (24%).

The Business Barometer, which surveys 1,200 businesses monthly, provides early signals about UK economic trends both regionally and nationwide.

A net balance of 30% of businesses in Scotland expect to increase staff levels over the next year, up five points on last month.

Martyn Kendrick, regional director for Scotland at Bank of Scotland Commercial Banking, said: “While we’ve seen a dip in confidence from businesses in Scotland, we’re still seeing strong figures at 31%, just four points below the national average.

“With the festive season keeping many businesses busy, it’s encouraging to see them thinking positively about the year ahead with trading prospects one point higher than the UK average.

“For those planning to invest in their teams and evolve their offer, now is a perfect time to think about cash flow to ensure they enter the new year on steady footing, ready to capitalise on new upcoming opportunities. We’ll continue to be by the side of businesses throughout 2024 and beyond to help them prosper.”