Confidence drops across UK services in face of higher costs and weak demand

CBI polling of the sector shows most companies are downbeat about future and are reporting lower profits

Business confidence plunged this month across the UK's services sector as mounting cost pressures and weak demand hit profits and undermined the outlook for the rest of the year.

The CBI's latest service sector poll found that a majority of companies were gloomy about their prospects and discounted the acceleration in activity that usually follows the return to work after the summer break.