Scottish economy shows improvement

The survey found that manufacturing was leading the emergence from recession

A survey of the Scottish economy has found the turnover of firms at its most positive for more than two years.

The Lloyds TSB Scotland Business Monitor said the production sector had recorded a "robust recovery" in the three months to the end of November.

Service businesses also showed an improvement and export activity held steady.

However both production and service firms' assessments of their prospects has deteriorated.

Service sector businesses are particularly gloomy about how they will fare over the next six months.

Cost pressures remained high, according to the survey, with the number of firms experiencing higher prices up significantly on a year ago.

However concerns about the availability of credit have declined in the latest three months although concerns about just how much that credit is costing remained largely unchanged.

The picture emerging, according to this latest monitor, is of Scotland continuing to recover from recession with the results the best in 2010.

Donald MacRae, chief economist, Lloyds TSB Scotland, said: "Manufacturing is leading the emergence from recession. However, a slowdown to low growth is in place at the end of 2010.

"Both consumer and business confidence remain positive but at low levels keeping consumer spending and retail sales increasing at moderate rates."