The Bank of Scotland’s chief economist has said that the likelihood of a double dip recession hitting the country is “diminishing”.
Donald MacRae made the claim following the publishing of the bank’s February Purchase Managers Index (PMI), which showed that employment and output had both been on the increase.
His announcement was also backed up by the Federation of Small Businesses (FSB) Index, which showed a rise in business confidence, following the record low levels which were recorded towards the end of last year.
The Bank of Scotland’s PMI, which monitors seasonally adjusted activity within Scotland’s service and manufacturing industries, showed an increase from 51.4 for January to to 51.7 for February – the quickest rise in five months.
When compared to the rest of the UK this was a slower rate, though the FSB confidence was higher.
The increased confidence shown by the FSB demonstrates that businesses are taking a far more proactive role for themselves. Many companies are now seeking commercial finance in Scotland through invoice factoring, ahead of usual lending streams, stifled by restrictions in the sector.
The Scottish government has again repeated its claim that it is ardently trying to boost access to finance but still required central government to do more, with Finance Secretary John Swinney saying:
“The Scottish government is doing everything it can to support the recovery but the UK government has to take urgent action to promote investment…
I’ve written to The Chancellor ahead of this week’s budget to ask [for] additional capital investment to provide a targeted economic stimulus.”