- Rate of output growth unchanged since July
- Upturn in new orders cools
- Confidence levels strongest in 18 months
Latest Regional Growth Tracker data from the Royal Bank of Scotland signalled sustained private sector growth. The Scottish private sector signalled sustained and solid growth in activity midway through the third quarter. The economy was again, however, driven by the service sector, masking a downturn at manufacturers. Service firms also revealed a further improvement in demand trends, though data did indicate a slight cooling. As a result, overall growth in new orders eased on the month. The headline Business Activity Index remained unchanged from the month prior and printed 52.7 in August. Expansions in activity across Scotland have now been noted in each month this year, with growth remaining skewed towards service providers. That said, companies in both sectors expect activity to rise in the coming 12 months, with overall sentiment the strongest in one-and a-half years.
Judith Cruickshank, Chair, Scotland Board, Royal Bank of Scotland, commented:
"The Scottish private sector continued to expand on the back of solid growth in activity observed across its service firms. Meanwhile, the manufacturing sector remained suppressed as deteriorating underlying demand trends continued to weigh down on production. While the service sector has beenpivotal in supporting growth in private sector activity since the start of the year, there were some signs of cooling demand during August. Growth in new orders softened, and services employment also ticked up at a softer pace. That said, firms remain optimistic that growth in business activity will be sustained in the coming 12 months, with expectations across the Scottish private sector hitting an 18-month high. Meanwhile, business expenses increased at one of the weakest paces since February 2021."
Please see the regional report in full:
Royal Bank of Scotland UK Regional Growth Tracker (PDF, 1,008KB)
