New orders boost for businesses

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Business in Scotland is growing at its fastest pace for 26 months, according to a purchasing survey.

The monthly report of about 600 companies showed positive movement in new orders, but the signs of recovery still lag those across the wider UK.

The survey is carried out by consultants Markit Scotland.

It said the extra business demand was being met by spare capacity in private sector companies, rather than leading to recruitment of staff.

The Markit Scotland Purchasing Managers Index found that output rose at the fastest pace since September 2007, extending the current period of activity growth to five months.

A sharp rise in new business also suggests that demand across the economy is starting to recover Andrew SelfMarkit economist

Panel members highlighted a general improvement in economic conditions as the principal factor in rising demand and new orders in November.

However, input price inflation rose to a one-year high during November, pushed up by weak sterling and higher fuel costs

Andrew Self, economist at Markit, said: "Scotland continued along the path towards economic recovery during November, as private sector output expanded at the fastest pace in over two years.

"A sharp rise in new business also suggests that demand across the economy is starting to recover. However, it must be remembered that the recovery is coming from an extremely low base and conditions remain tough.

"November saw firms cut tariffs further, despite the backdrop of accelerating input price inflation."