Fragile recovery in transatlantic confidence as US investors warn on UK competitiveness

The 6th edition of the annual Index from BritishAmerican Business and Bain & Company finds confidence in the US-UK business corridor has edged up to 6.7 out of 10, from a record low of 6.6 last year. US companies' confidence in the UK improves marginally, from 6.3 to 6.4, with investors continuing to raise concerns about tax, regulation and energy costs. UK companies' confidence in the US rebounds more strongly, from 7.5 to 8.1, with investment intentions remaining strong despite concerns around political stability, immigration and trade policy.The 2026 Transatlantic Confidence Index from BritishAmerican Business (BAB) and Bain & Company, which surveyed 74 leading transatlantic companies, reveals a modest recovery in confidence in the transatlantic economy following last year's sharp decline.The overall Index, which remained stable at 7.0-7.2 out of 10 between 2021 and 2024 before falling to 6.6 last year, edged up to 6.7 in 2026. While investment intentions remain strong on both sides of the Atlantic, businesses continue to raise concerns about tax, regulation, energy costs and policy predictability.US companies report slightly higher confidence in the UKUS companies' confidence in doing business in the UK edged up from 6.3 in 2025 to 6.4 this year, following last year's fall to the lowest level since the Index began.Despite the slight improvement, US investors continue to raise concerns about the UK's domestic business environment. Tax and the cost of doing business remain significant concerns, while energy supply and costs – included in the survey for the first time – were viewed just as negatively as tax.US businesses are calling for a more competitive environment for investment. 35 per cent ranked a flexible, predictable and business-friendly regulatory and tax environment as their number one priority, while 75 per cent placed it in their top three.Businesses also want to see regulatory reform and simplification, delivery of the UK's industrial strategy and planning reforms, and greater certainty around energy supply and costs. 92 per cent of US respondents rated the implementation of a pro-growth agenda at seven out of ten or higher in importance to their future investment in the UK.Despite these concerns, US companies remain committed to the UK market, with most respondents expecting to maintain or increase their investment over the next two to three years.Perceptions of the UK's political stability also deteriorated, with its net attractiveness score falling from +37 in 2025 to -12 this year. The survey was conducted as expectations of a change in political leadership were growing, and before the new Prime Minister took office. Confidence in the UK-EU relationship also slipped from 6.6 to 6.2.UK companies' confidence in the US reboundsUK companies' confidence in doing business in the US increased from 7.5 out of 10 in 2025 to 8.1 in 2026, recovering much of last year's decline.Confidence in the US approach to economic policy also improved, rising from 5.4 to 6.5 out of 10.The fundamentals of the US market continue to be highly attractive to UK investors. Access to capital and talent remain important strengths, while UK business leaders rated their confidence in US innovation at 8.5 out of 10.This is reflected in investment intentions, with 86 per cent of UK respondents planning to moderately or significantly increase their investment in the US.However, concerns remain around political stability, immigration policy, and trade. UK businesses want the US to maintain open markets and strong economic relationships with its trading partners.Duncan Edwards, CEO of BritishAmerican Business, said: "US companies still want to invest in the UK, but they are increasingly clear about what is getting in the way. Tax, regulation and the cost of energy are all weighing on the UK's competitiveness. The UK is competing for investment every day and we shouldn't take that investment for granted. Confidence has edged up, which is welcome, but there is clearly more work to do. With another Budget coming up, businesses will be looking for predictability and won't want to see further increases to the cost of doing business."Jonathan Frick, partner at Bain & Company in London, said: "The transatlantic business corridor has proved resilient through a very unsettled period, and companies remain committed to investing on both sides of the Atlantic. But the findings also show that the fundamentals matter. Cost, regulation, access to talent and policy predictability will continue to shape where businesses choose to invest."Media contactsFor any questions or to arrange an interview, please contact:BritishAmerican Business:Dominic Parker (London) [email protected] Bain & Company:Gary Duncan (London) [email protected] Notes to EditorsThis is the sixth edition of the Transatlantic Confidence Index issued by BritishAmerican Business and Bain & Company.The Index measures the confidence of US companies active in the UK and UK companies operating in the US. When appropriate, data from prior Index surveys is referenced for comparison. A total of 74 companies responded to the 2026 survey, including 53 US companies operating in the UK and 21 UK companies operating in the US. Combined, they employ nearly 275,000 people and represent a range of sectors, including financial services, technology, healthcare, media, telecommunications, and manufacturing.While many factors influence confidence, the Transatlantic Confidence Index focuses on overall confidence for investing and trading, short-term investment prospects, and the health of the US-UK economic relationship.

Fragile recovery in transatlantic confidence as US investors warn on UK competitiveness

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