Business confidence has increased significantly in the manufacturing and engineering sector in that last three months, according to the latest survey carried out by the Institute of Chartered Accountants.
The Institute's index of business confidence turned positive at the end of June, the first real evidence that the recession in the UK may be over.
The Institute predicts that the UK economy will grow by 0.5% in the third quarter.
"This quarter's BCM suggests that the UK recession is at an end," said Michael Izza, chief executive of the Institute of Chartered Accountants.
This will come as reassuring news to companies following news last week that German, France and Japn were already out of recession in Q2, a period when the UK economy still contracted by 0.8%.
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There was evidence of a big jump in business confidence in the manufacturing and engineering sector which saw its index rise by 30.4 points, the largest quarterly rise on record, to take confidence to its highest since Q1 2008.
However, confidence in the sector remains slightly negative.
Inventory levels remain low with more than a quarter of firms in the manufacturing, construction and transport sectors report stock levels below normal, suggesting growth could be round the corner as the inventory cycle turns.
There are also signs that consumer confidence is edging up.
The IT sector came in as the most confident, according to the data.
"While there is no doubt that the UK economy is on its way to recovery, we shouldn't underestimate the challenges ahead for businesses," said Izza.1