Business confidence across the nation dipped during the last quarter although business leaders remain confident about the economy.

A report from business information group Dun & Bradstreet showed fewer business leaders predicting rises in profits, sales or employment over the next quarter than three months ago.

Of the 1,600 firms surveyed, 66 per cent expected to increase sales in the third quarter of the year, against a higher 71 per cent in the previous quarter.

And 53 per cent expected to increase profits, against a stronger 61 per cent last time.

Employment prospects were also down, with 34 per cent of companies expecting to increase staff compared with 43 per cent three months ago.

However, the number of firms expecting to shed staff remained around the same at 12 per cent.

Although the figures were less bullish than the previous quarter, the survey showed companies had moved away from the boom-and-bust pattern of the early to mid-1990s to a period of less volatility in price changes.

Business leaders, surveyed just before the announcement of the Chancellor Gordon Brown's spending review, were still on the whole very confident about the economy.

Philip Mellor, senior business analyst at Dun & Bradstreet, said: "At D&B we often see an annual pattern emerging with business confidence in the third quarter reverting back to the same level as in the first quarter.

"This has happened this year. The overall state of the economy is the same, with manufacturing suffering slightly and services and retailers holding their own or doing very well."

The survey showed the South East experiencing confidence above the national average, although it had dipped from the beginning of the second quarter.

The index for sales fell from 62 points to 56, while profits fell from 49 points to 39.