The Scottish private sector continued to recover from the impact of the coronavirus pandemic in September, according to the latest Royal Bank of Scotland PMI (purchasing managers’ index) report.
But growth in business activity slowed from August’s six-year high.
Growth of business activity lost momentum, with the latest increase only marginal overall, amid a renewed decline in new business.
“Nonetheless, firms remained confident that output would rise over the coming year amid hopes of a further recovery in demand,” said the report.
“Expectations were the weakest for four-months, however, reflecting heightened uncertainty about how long lockdown measures will last and the timeliness of any recovery …
“The Future Activity Index posted above the 50.0 threshold for the fifth consecutive month during September, to signal overall optimism among Scottish firms with regards to output over the year ahead.
“Anecdotal evidence linked confidence to hopes of improved client demand and an economic recovery.
“That said, the level of positive sentiment dipped to a four-month low, reflecting concerns about the introduction of more stringent lockdown measures and the timeliness of any recovery …”
Malcolm Buchanan, chair, Scotland Board, Royal Bank of Scotland, said: “The latest PMI data highlighted slower growth of the Scottish economy, with business activity rising only marginally overall.
“Meanwhile, inflows of new work fell following an uptick in August, with survey respondents citing weak client demand due to stricter lockdown measures.
“These measures also dented firms’ confidence during September. Sentiment was still positive overall, but slipped to a four-month low.
“Meanwhile, job cutting continued, with the rate of reduction remaining marked.
“Nonetheless, data highlighted a good performance in the context of the rapid contractions seen in the spring.
“Weak client demand is a concern, but unsurprising with lockdown measures tightening.
“Hopefully, as in August, once the pent-up demand is released, the sector will move full throttle towards a recovery.”