The CBI in Yorkshire today called for a cut in interest rates after a survey revealed business confidence in the region is still lagging.

Just six per cent of West Yorkshire firms expect the economic situation to improve, according to the research carried out by the CBI and Yorkshire Forward.

And CBI regional director Penny Hemming said it showed firms were still suffering from the global economic slowdown.

"Firms in the region are now expecting only a modest pick up in business, which means they are less bullish than they were only a few months ago," she said.

"That shows the long-awaited economic recovery is still failing to gather momentum. There have been too many false dawns so a cut in interest rates would be a timely and wise move."

Despite the gloom, some West Yorkshire firms did predict orders would improve at home and abroad and financial and business services remained optimistic.

Firms also said the main factors inhibiting growth remain inadequate support from government, shortage of finance and difficulty in attracting staff with 80 per cent of firms reporting vacancies over the past 12 months.

Yorkshire Forward chairman Sir Graham Hall said the regeneration agency was doing all it could to minimise the impact of global recession.