England’s PMI rose to an 18-month high of 57.2 in December – up from 55.8 in November and well above July’s low of 47.4. Meanwhile in Wales, business activity growth accelerated to the highest level for 18 months, with a PMI reading of 57.4. A reading greater than 50 signifies growth in business activity.
The strongest performing region was the East of England with a PMI reading of 59.8, while the East Midlands was the slowest growing area out of all regions (56.0) despite recording strong growth.
Lloyds said that stronger demand for goods and services was behind the upturn in December, with businesses responding by hiring more workers.
Sterling’s weakness was also reflected in another increase in average prices charged for goods and services as businesses tried to pass on higher input costs to customers.
The Lloyds Bank Regional PMI is based on responses from businesses in the manufacturing and service sectors about the amount of goods and services produced each month compared to the previous one.
Tim Hinton, managing director of Mid-Markets and SME Banking at Lloyds Banking Group, said: “Business activity accelerated in December, showing the largest rise in 18 months and the index almost 10 points above the 2016 low of 47.4.
“The healthier order books suggest that the economy is starting 2017 with good momentum, but businesses will continue to be mindful of inflation and sustained pressure on their costs.”
Manufacturing activity growth hits 18 month high
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Manufacturers in England and Wales finished 2016 in a “strong” position with businesses reporting the fastest growth in activity in 18 months, according to the latest Lloyds Bank Regional Purchasing Managers’ Index (PMI).
