BUSINESS confidence among UK firms fell back in recent weeks, showing that the recovery from recession was likely to be ‘‘gradual and uneven’’, according to a report.

A survey of 200 companies by Lloyds TSB showed that just over half were more upbeat than a year ago, but one in five were more pessimistic.

Despite the dip, confidence levels are still higher than a year ago, said the report.

Distribution firms were more confident than services businesses about the outlook, while the biggest fall in confidence was reported in the North and Midlands.

Trevor Williams, chief economist at Lloyds TSB Corporate Markets, said: “Although confidence levels fell back at the end of the year, the context here is critical. Across the board, businesses are now far more optimistic about the economic outlook than they were 12 months earlier.

‘‘The fact that confidence is not on a smooth upward path is another reminder that the pace of recovery may be gradual and uneven, but it is clear that overall optimism among firms is still growing.’’