UK economic recession at an end

Posting its biggest-ever rise, ICAEW's Business Confidence Monitor (BCM) has moved to positive territory for the first time in two years.

"This quarter's BCM suggests that the UK recession is at an end," said Michael Izza, chief executive of the ICAEW, predicting half a percent of growth in gross domestic product (GDP) after five quarters of declining output.

The economy shrank a much bigger than expected 0.8 percent in Q2 but Chancellor Alistair Darling said last week the economy was on track to start growing again by the end of the year.

Investors will watch for the second reading of Q2 growth this week, due on August 28.

"While there is no doubt that the UK economy is on its way to recovery, we shouldn't underestimate the challenges ahead for businesses," ICAEW's Izza said.

When asked, 41 percent of the 1,000 senior business professionals surveyed were more confident about economic prospects for their business in the next year, the BCM showed.

However, only 6 percent were much more confident, indicating that caution remained about the strength and timing of the recovery.

"The recovery is very fragile and I would urge policy makers not to take any actions that could derail it."