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PMI points to growth; BDO says optimism at new low

Wireline industrySigns of a return to growth have emerged in Scotland’s private sector following two months of stagnation.

There was a rise in orders in June across manufacturers and service providers. Price discounting was cited by Scottish goods producers as one of the main factors behind the increase.

However, the latest seasonally adjusted headline Bank of Scotland purchasing managers index showed firms continued to cut jobs for the seventh successive month.

Graham Blair, regional director, SME banking Scotland, said:June’s survey data was the strongest so far in 2016, which will be encouraging news for Scottish firms.”

A gloomier survey from BDO suggested business optimism and output had fallen to a three year low while hiring intentions are at a two year low.

According to the latest Business Trends Report by accountants and business advisers BDO this is down to the uncertainty surrounding the EU referendum vote.

However, the figures have been in decline for a year, indicating more deep-rooted problems with the economy.

Martin Gill, Scottish head of BDO, said: “There is little doubt that uncertainty prompted by Brexit has resulted in disrupted investment in the Scottish economy, but the signs of a slowdown were already showing ahead of the decision. The latest output and optimism figures are down considerably on June 2015 when the EU referendum wasn’t even on the agenda.”

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