UK business confidence rose to a 13-month high in June as firms shrugged off another Bank of England interest-rate increase, a survey by Lloyds Banking Group Plc found.

Lloyds’ Business Barometer showed optimism increasing 9 percentage points to 37%, rebounding from a dip in May. Executives said they were more confident about their own trading prospects and the wider economy.

The poll of 1,200 firms was conducted from June 1 to June 15, weeks after the BOE delivered a 12th consecutive rate hike in a bid to tame inflation. On June 22, however, the BOE stepped up its campaign with a larger-than-expected half-point rise to 5%, the highest since 2008.

“Interest-rate rises and cost pressures are still felt by many and we await to see the impact of the latest 50 basis-point rise in base rate,” said Hann-Ju Ho, senior economist Lloyds Bank Commercial Banking.

Increased confidence was reported across regions and sectors, and firms expected to keep hiring, Lloyds said.

Wage expectations stabilized, in a sign that the red-hot labor market worrying the BOE may be cooling. However, they remain higher than at the start of the year and elevated relative to pre-pandemic levels.