Business sentiment improved at the start of this year after seeing somewhat of a slump last year, a new survey shows. 

Last year's dip was mostly because of the uncertainty around Brexit and what the Trump administration would mean for business here.

But the latest survey from KBC Bank Ireland and Chartered Accountants Ireland shows that companies' activity levels proved more resilient than had been feared and concerns about the broader Irish economy eased a little.

The KBC Bank Ireland/Chartered Accountants Ireland Business Sentiment Index rose to 104.8 in the winter quarter of 2016/17.

This was a modest improvement from the 100.1 reading in the autumn survey, but still well below the peak reading of 131.1 recorded a year ago. 

The survey also showed that while employment levels are growing, the pace of hiring is slowing, which KBC said reflected the uncertainty out there.

It also said that pay increases are becoming the norm with some 83% of companies predicting that their average pay will increase in 2017 while 16% see no change.

On Brexit, 40% of companies said that the UK's decision to leave the European Union was already impacting their business with negative effects outweighing positives by about ten to one. 

Companies reported that increased uncertainty and exchange rate volatility were their main concerns.

Meanwhile, increased uncertainty was also seen as early effect of new Donald Trump administration in the US. 

About one in three firms expects some impact from Trump's promised changes with expectations of negative effects outweighing positives by about seven to one, the survey found.