Paul Smith is Director and Senior Economist at IHSMarkit, where he helps to oversee the production of business survey data for over 30 countries. His research interests include nowcasting and the role that new sources of information (particularly so-called ‘big data’) can play in helping to understand current economic conditions.
Latest data from the Purchasing Managers’ Indices (PMI) surveys indicated that the Scottish economy broadly underperformed the rest of the UK during August.
Coming in at a disappointing 49.1, fractionally down on July’s 49.2 and a five-month low, August’s Bank of Scotland PMI pointed to a second successive marginal contraction in private sector output (any reading below 50.0 points to monthly contraction).
The latest data maintains a trend seen throughout 2016 of an economy struggling to expand, and one continuing to lag wider UK economic output.
Indeed, the latter showed a remarkable degree of ‘bouncebackability’ in August following a partial unwinding of the immediate economic and political uncertainty created by the decision to leave the EU. The UK Composite PMI (covering the manufacturing and service sectors) moved up to a five-month peak of 53.6, a rise of over six points from July’s Brexit induced nadir of 47.5. July aside, the UK PMI has posted consistently above the equivalent Scottish index throughout the past three years.
Continue reading “Insight on August 2016 PMI measures”