Private sector enjoyed 'tentative upturn' in April

There was a tentative upturn'' in Scottish private sector growth last month, according to a new study.

The sector made a positive start to the second quarter, seeing growth pick up slightly from the relative stagnation'' experienced in the preceding Bank of Scotland Regional Purchasing Managers' Index (PMI) survey.

The slight upturn was driven by the manufacturing sector, which offset shrinking services output, the study found.

Meanwhile, job creation in April was at its strongest in eight months, although business confidence was at its lowest in six months.

The seasonally-adjusted headline Bank of Scotland PMI rose to 50.6 from March's four-month low of 50.1, with readings above 50 signalling an increase or improvement.

Fraser Sime, regional director at Bank of Scotland commercial banking, said: April's PMI signalled a tentative upturn in Scottish private sector growth, with both output and employment increasing at faster rates.

The latest survey's results were driven by a strong manufacturing sector, which moved up a gear in April. There was good news all round, from steep production growth to solid job creation and a further easing of cost pressures.

Meanwhile, the service sector marred April's PMI score as business activity in the sector shrunk for the second month running.

A faster rise in new orders bodes well, though continued growth in the second quarter remains heavily dependent on the relatively stronger manufacturing sector.''

The combined output of Scotland's manufacturing and service sectors grew marginally in April.

There was also a modest increase in new orders placed at Scottish private sector companies, with the latest rate of growth matching January's 20-month high.

Price pressures remained sharp last month, with respondents noting rising raw material cost and wage pressures as key factors.

Confidence towards future growth prospects remained strongly positive'' in April, although expectations have eased since March, which firms attributed to political and economic uncertainty in Scotland.