Nottingham City Centre
East Midlands businesses experienced a strong increase in new orders during July, according to the latest research by Lloyds Bank.
The East Midlands Business Activity PMI® posted 55.9 in July, up from 55.4 in June. A reading above 50 signifies expansion in business activity, whilst a reading below signals contraction.
The latest reading signalled strong growth in the output of firms’ products and services, and the pace of expansion was faster than the UK average.
New orders and greater demand for goods and services supported strong job creation in the region.
Business confidence improved noticeably in July, with overall positive sentiment about future performance recovering from June’s historic low.
Firms attributed their optimism to increased marketing activity and a higher demand for their goods and services.
Local firms also continued to pay more for input costs during July, which include raw materials, salaries and overheads, with companies mentioning that exchange rate fluctuations had been a factor.
In a bid to offset this, management teams increased average prices charged to customers, although they did this at the weakest pace seen for a year.
Glen Wilson, regional director for SME banking in the East Midlands at Lloyds Bank Commercial Banking, said: “There was good news for East Midlands firms in July, with new orders and employment on the up and output growth exceeding the UK average.
“On the price front, the businesses’ costs increased at a robust pace, with firms passing on some of the extra burden to customers. However, business confidence improved significantly, driven by strong client demand.”
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 amount of goods and services produced during July compared with a month earlier.