Scotland’s economy is “approaching stabilisation”, according to a business report, but there are fears local lockdowns could delay recovery.
The latest Royal Bank of Scotland Purchasing Managers’ Index (PMI) found the coronavirus-related downturn in the Scottish private sector “eased noticeably” in July.
The report’s Business Activity Index – a measure of combined manufacturing and service sector output – registered 49.3 in July, up from 37.1 in June.
It also found the softest fall in private sector output since March.
While private sector firms reported a reduction in new business in July, confidence strengthened to a five-month high.
The optimism is linked to hopes of an economic recovery once lockdown measures are lifted, the report suggested.
However it reported a reduction in Scottish private sector employment for the sixth month in a row.
Malcolm Buchanan, chairman of the Scotland board at Royal Bank of Scotland, said the July data shows some encouraging signs.
But he warned that while July’s figures “are a significant step in the right direction, we are still yet to see growth”.
He added: “A possible ‘second wave’ of the pandemic and reintroduction of lockdown measures in regions such as Aberdeen has the potential to derail any further moves towards a recovery.”
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