Scottish economic growth 'slows further'

The survey suggested a marked fall in new business for manufactured goods

The pace of growth in Scotland's private sector economy slowed further last month, according to a survey of business managers.

The Bank of Scotland's latest Purchasing Managers' Index (PMI) suggested a second successive monthly drop in new business orders.

The bank said a marked fall in demand for manufactured goods lay behind the latest decline.

However, service providers saw a modest pick-up in new business.

The index indicated firms were working through backlogs of work to sustain output growth.

Employment continued to fall at modest pace, while businesses absorbed cost pressures as charges remained broadly unchanged.

In contrast to the trends shown for new work, Scottish manufacturers registered a moderate rise in headcounts in October, while their service-providing counterparts cut jobs.

Employment within the Scottish private sector overall fell for a third month running, albeit at the weakest rate in the sequence.

'Marginal growth'

Bank of Scotland chief economist Donald MacRae said: "The October PMI recorded its tenth consecutive positive month this year, indicating the private sector of the Scottish economy continued to grow, albeit only marginally.

"However, the pace of growth fell to its lowest level for ten months while new business orders fell slightly for the second consecutive month.

"Input cost pressures eased but remain strong."

He added: "The Scottish economy is showing resilience in the face of the global slowdown but is struggling to maintain growth momentum."