BUSINESS leaders are rallying this weekend in an attempt to restore consumer confidence.

“We are in danger of talking ourselves into a worse place than we needed to,” said Justin King, the J Sainsbury chief executive .

Sir Philip Green, the BHS and Topshop entrepreneur, added: “People are fed up with reading about doom and gloom. The underlying foundations of the UK economy are strong and we should not allow anything from what is a global situation to send us off track.”

Simon Cowell, the X Factor judge who runs music and television business Syco, agrees. “I have more confidence in this country than at any other time in my life,” he said.

Chief executives believe Britain’s relative strength lies in low unemployment and interest rates cut by 0.5% last week.

They think Gordon Brown’s £500 billion plan to strengthen the financial sector by offering to part-nationalise high-street banks should steady the ship.

“Instead of being half a step behind events, what the government has done is probably one step ahead of events,” said Sir Stuart Rose, executive chairman of Marks & Spencer. “It doesn’t mean there aren’t going to be problems but people need to recognise that life is not going to stop.”

Hugh Osmond, the entrepreneur owner of Pearl Assurance, said: “The UK rescue plan is the most comprehensive plan that any government has come up with to address this crisis.

“It is very clever and well thought through, addressing the issues of capital and liquidity. Once this scheme has been enacted, we will have the strongest banks in the Western world.”

Retailers concede that consumers’ willingness to spend has fallen. Asda’s income tracker suggests the average family is £11 a week worse off compared with a year ago, due in part to soaring household bills. However, the supermarket group’s chief executive, Andy Bond, said there was light at the end of the tunnel.

“Food inflation has already peaked and we are beginning to see the price of groceries falling again’” he said.

Sainsbury’s King added: “We don’t want to encourage consumers to spend money they can’t afford but the crisis within banks and now shares more generally does not have to transmit itself to the real economy.”

Explore Economics

• Pre-Budget Report 2008

• Budget 2009

• World Economic Forum

• The Times MPC

Times Recommends

• C&G axed - 1,660 jobs to be lost
• UK house prices rise 1.1% as buyers return
• Mixed reaction to US banks repaying bailouts