Financial services firms are expecting a rapid increase in jobs losses over the coming months as investment plans and optimism levels sink to fresh lows.

The sector’s activity fell at the fastest rate since December 2023 in the three months to June, according to the Confederation of British Industry (CBI).

This marked the first time activity in the sector has decreased in more than a year. 

A sharp drop in output at banks led to the downturns as businesses anticipated slower activity for the coming months. 

Staffing across the financial services sector fell with the firms expecting an acceleration in job losses.

City AM previously reported British banks were shedding workers at the fastest rate since 2018.

Total employee numbers at British lenders slumped 5.25 per cent to 580,371, falling to the lowest number in a decade, according to data from The Banker.

Standard Chartered and HSBC were responsible for the biggest culls after putting 4.5 per cent and 4.3 per cent of employees on the chopping block.