Confidence in the region increased by nine points in January, reaching 45 per cent.
Firms in the North East expressed more confidence in their own business prospects, which rose by 21 points to 68 per cent, the highest figure of any UK region.
This confidence in trading prospects, coupled with a slight dip in economic optimism, which fell by three points to 22 per cent, contributed to the overall confidence reading.
A net balance of 44 per cent of businesses in the region also anticipate expanding their workforce in the coming year, a four-point increase on the previous month.
Martyn Kendrick, regional director for the North East at Lloyds, said: “After a dip in confidence in December, the new year has brought with it new beginnings and a more positive outlook among the region’s businesses.
“It’s particularly encouraging to see North East firms leading the country when it comes to confidence in their trading prospects.
“This is testament to the ambition and resilience of our business local community.
“We’re proud to stand alongside them, and ready to support their plans as they navigate an exciting year ahead.”
The Business Barometer, which has been tracking economic trends since 2002, surveys 1,200 businesses monthly.
It provides early signals about UK economic trends both regionally and nationwide.
On a national level, UK business confidence fell slightly in January, dropping by two points to 37 per cent.
While optimism in individual trading prospects strengthened by four points to 51 per cent, overall confidence in the wider economy decreased by seven points to 24 per cent.
Hann-Ju Ho, senior economist at Lloyds Commercial Banking, said: “The figures for trading prospects show promise with businesses signalling more resilience and assurance in their ability to weather perceived economic headwinds.
“The regional picture is similarly a cause for optimism, with seven regions reporting higher confidence, meaning it is the first time since July there has been more confidence rises than falls regionally.”
A rollback of diversity initiatives in the UK risks undoing decades of progress, the CEO of the Co-op group has warned, as US multinationals scale back commitme
Concerns are mounting that UK businesses could face steeper trade taxes after former US president Donald Trump announced plans to introduce “reciprocal t
Michael RaceBusiness reporter, BBC NewsGetty ImagesConcerns are growing the UK could be hit with higher US trade taxes after President Donald Trump announced he
UK sanctions several high-profile individuals with links to Putin’s inner circle in latest crackdown on the Kremlin. Russia’s war machine further c