The UK and India have emerged as the most attractive destinations for global investment, according to Deloitte's latest survey of UK Chief Financial Officers (CFOs). This marks a significant shift in sentiment, with the UK climbing from sixth place in the fourth quarter of 2024 to the top position, now tied with India.

Richard Houston, senior partner and chief executive of Deloitte UK, said: “These results reveal a shift in sentiment with the UK now viewed as a leading global investment destination. This renewed confidence, coupled with a rise in risk appetite, is welcome and underscores the considerable investment potential the UK offers.”

The survey, conducted between June 16th and 29th, indicates that a net 13% of CFOs describe the UK as very or somewhat attractive for investment. This contrasts sharply with the previous survey, where the UK lagged behind the US, India, the Middle East, emerging Europe, and Japan.

Several factors contribute to this increased attractiveness. The UK's rapid ascension is partly due to the decline of the US as an attractive investment destination, influenced by downgraded growth forecasts and a weakened dollar. However, the UK has also benefited from being one of the first countries to sign a renewed trade deal with the Trump administration in early May.

Moreover, CFOs' risk appetite has increased, with 17% believing it is a good time to take greater risks onto their balance sheets, compared to 12% in the previous quarter. This shift indicates a move away from defensive strategies and a greater willingness to pursue expansionary strategies such as introducing new products or expanding into new markets.

Business sentiment is also more balanced, with a slight increase in business optimism among CFOs. The index of business optimism saw a modest increase for a second quarter to -11%, compared to -14% last quarter. CFOs now expect inflation to decline to 2.9% by the middle of next year and expect the Bank of England to lower its base rate to 3.75% over the next 12 months, down from its current rate of 4.25%.

Laurent Descout, CEO and co-founder at Neo, highlighted London's access to capital, talent, and thriving Fintech ecosystem as key appeals for CFOs. He also noted the evolving role of CFOs, who are increasingly expected to lead investment decisions and help shape long-term strategy. Fintech's role in automating processes and delivering real-time insights further supports smarter and faster decision-making for CFOs.

This positive outlook is further reinforced by the UK government's deregulation drive aimed at boosting risk appetites and easing the burden on businesses. Chancellor Rachel Reeves has urged the Bank of England and the FCA to set rules promoting growth, signaling a commitment to fostering a more বিনিয়োগ-friendly environment.