Business activity in the capital’s private sector rose in September for a second consecutive month, in the strongest rate since January. Higher output was recorded across both the manufacturing and service sectors.
The London PMI now stands at 54.3 as of September, up from 52.5 in August – and almost 10 points higher than in July, when it recorded 44.4 following the EU referendum.
Paul Evans, regional director, SME Banking in London, Lloyds Banking Group, said: “The capital’s private sector economy continued to bounce back from its post-referendum low, with business activity rising at the fastest rate for eight months in September.
“Solid expansions in new business and backlogs suggest that output growth will be maintained as we head into the final quarter of the year. However, firms again had to absorb rising input costs amid strong competitive pressures.”
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 services businesses about the value of goods and services produced during September compared with a month earlier.
The report shows London firms are experiencing growing demand for their goods and services. The level of new business rose for the second month running during September – with the strongest month-on-month increase in new business since January.
However, input prices increased further in September, rising at the fastest rate for six months. On the other hand, prices charged for goods and services increased only fractionally.
Meanwhile, the jobs market in the capital is developing more mixed signals. Staffing levels in London’s private sector firms rose for a second month in succession. However, the rate of jobs growth eased to a marginal pace that was weaker than the UK average.