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Scottish economy shows marginal improvement

Nia Williams

April 5, 2013

In the three months ending February 2013, 29% of firms surveyed increased turnover, 37% experienced static turnover, and just over a third (34%) experienced a decrease.

This gave a net balance of -5%; a slight improvement from the -10% of the previous quarter and the -6% of the same quarter one year ago.

The overall net balance of turnover for firms in the production sector in the three months to end February this year was +2%. This is a very slight improvement on the +1% of the previous quarter but is identical to the +2% of the same quarter one year ago.

Service businesses are showing a larger improvement. The overall net balance for turnover for the three months ending February was -9%, significantly better than the -16% of the previous quarter and the -11% of the same quarter one year ago.

Expectations for turnover in the next six months are showing an overall net balance of +1%. This is a welcome improvement on the -5% of the previous quarter and a return to the +2% of the same quarter one year ago.

Whilst just over half (51%) expect turnover to be static in the next six months, a quarter expect turnover to increase against 24% who expect a decrease. Production firms are more optimistic than service firms with production firms showing an overall net balance for turnover for the next six months at +10% compared to -4% for services firms.

Donald MacRae, chief economist, Bank of Scotland said: “The Scottish economy stagnated during Autumn 2012. This latest Business Monitor suggests a slight relaxation in that stagnation.

“Despite the apparent poor performance in Autumn, business expectations for 2013 have improved from a low position.

“A return to more vigorous growth in the Scottish economy awaits a further increase in confidence in both consumers and businesses. This in turn depends upon building on policy measures to contain the eurozone sovereign debt crisis and implementing policies to restore the eurozone and UK economies to growth.”


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