Source: Sharecast
According to research from the Confederation of British Industry, firms across the private sector are increasingly pessimistic about the rest of the year.
The latest growth indicator - a composite measure of activity based on responses to three long-running CBI surveys - showed a majority expect activity to decline in the company quarter, with a weighted balance of -20.
A balance is the percentage of companies reporting an increase minus those reporting a decrease.
Weakness was forecast to be broad-based. Business volumes in the service sector were expected to fall, with a balance of -18, due to lacklustre conditions across business, professional and consumer services.
Distribution sales - which covers retail and wholesale - were expected to fall sharply, with a balance of -33, despite the final three months of the year being critical for many retailers.
Manufacturing output, meanwhile, was also set to contract, with a balance of -14.
The downbeat outlook comes after overall private sector activity fell in the three months to September, with a balance of -32.
Weighing on that was the UK's dominant service sector. It saw business volumes slide in the last three months, with a balance of -35. The downturn was comparable across business and professional services - at 35% - and consumer services, with a balance of -34.
UK businesses are battling a number of headwinds, including higher costs - following rises in employer’s National Insurance contributions and the minimum wage - sticky inflation, historically high interest rates, tariffs and weak consumer sentiment.
Chancellor Rachel Reeves is due to present her autumn Budget in November.
But despite battling sluggish economic, she also needs to tackle soaring government spending and borrowing.
Further tax rises are increasingly expected as a result.
Alpesh Paleja, deputy chief economist the CBI, said: "The themes cited by businesses paint a by now familiar picture: demand conditions are lacklustre, with firms feeling the knock-on impact of cautious spending and investment behaviour across the economy.
"This is now accompanied by renewed nervousness around the Budget, with businesses concerned about being asked to again shoulder the burden of fixing the public finances."
The CBI's growth indicator is based on responses to the most recent industrial trends, distributive trades and service sector surveys.
A total of 824 firms responded to the three surveys between 26 August and 15 September.
