South West business activity growth slows in November

Business activity in the South West lost growth momentum in November, according to the latest Lloyds Bank Regional Purchasing Managers’ Index (PMI®).

The South West PMI recorded 52.8 in November, down from 54.0 in October. A reading above 50 signals growth in business activity. The rate of expansion was the second-weakest out of the 12 monitored UK regions, with only Scotland posting a slower rise in private sector output.

Despite client demand also rising at a slower rate, businesses in the region continued to create new jobs.

Cost pressures remained a concern for businesses; however the rate of inflation in input prices – which include raw materials and salaries – eased when compared to the previous month.

The Lloyds Bank PMI, or purchasing managers’ index, is the leading economic health-check of UK regions. It is based on responses from manufacturers and service providers about the volume of goods and services produced during November compared with a month earlier.

David Beaumont, Regional Director of SME banking for the South West at Lloyds Bank Commercial Banking, said:

“While growth in business activity moved down a gear in November, business confidence remained resilient partly due to the prospect of higher export sales, contributing to an increase in new jobs.

“Overall growth looks set to continue into the start of 2018, but perhaps at a weaker pace than the trend seen over the past five years.”