Scottish economy sees 'robust growth', says Bank of Scotland

The survey suggested growth in manufacturing output continued to lose momentum in October

The Scottish economy entered the final quarter of the year with "robust growth", according to a business survey.

The Bank of Scotland's latest PMI monitor found private sector output rose markedly in October, while there was also a steep rise in the amount of new work for companies.

Job creation north of the border was also "solid" and broad-based by sector.

The survey was conducted with purchasing managers across Scotland.

The latest findings provide further evidence that the Scottish economy is continuing to recover.

The survey suggested that October's expansion was largely centred on the service sector, with growth in goods production easing to "only a modest pace".

The Bank of Scotland PMI - which measures manufacturing and services output - was recorded at 57.8.

Any reading above 50 indicates expansion.

Although slightly lower than August and September's survey-high readings of 58.3, the latest PMI was the fourth highest since the survey began in 1998.

Cost burdens

The PMI found input price inflation dipped slightly on the month, but remained much stronger than the rate of growth in output prices.

Food, fuel and utilities were identified by panel members as the key areas of inflationary pressure in the services sector.

The steepest rise in cost burdens was recorded in travel, tourism and leisure.

October saw another marked rise in new business for service providers, with growth led by financial services and business services.

Travel, tourism and leisure also recorded a substantial increase in activity on the month.

Meanwhile, manufacturing output growth continued to lose momentum at the start of the fourth quarter, easing to its weakest pace in five months.

Nevertheless, October marked the seventh consecutive monthly increase in the amount of goods production north of the border, following nine months of contraction.

Data also signalled a modest rise in new export orders at manufacturers in Scotland.

'Growth momentum'

Bank of Scotland chief economist Donald MacRae said: "The Scottish economy is maintaining growth momentum, making the recovery more sustainable with each passing month."

Finance Secretary John Swinney said the report reinforced recent data that demonstrated economic recovery was gaining ground.

He added: "These figures follow on from recent GDP and labour market statistics, which show the Scottish economy grew faster than the UK over the year to quarter two, with employment levels now at a five-year high and the economy growing continuously over the past four quarters.

"Business growth and investment will be key to securing economic expansion over the coming year and in this spending review period we are investing £10bn in capital projects, building homes, schools and facilities to support the economy."