2006-01-04

Stats & Money: Economy Slowing Down for 2006

Scotland has caught an economic 'cold' from the rest of the UK and has shown signs of slowing down, latest research has found. Nearly a third of almost 2_000 Scots firms in 'Lloyds TSB's Business Monitor Survey' reported a decrease in turnover in the three months to 2005-11. Some 38 per cent said turnover increased while 32 per cent said it remained the same, giving a net increase of 8 per cent , the report found. It was less than half the net increase of 17 per cent for the previous quarter. It was also much less than the 32 per cent recorded in the same period in 2004. The business monitor noted that the 'Services Sector' -- which makes up 70 per cent of Scottish economic output -- had experienced the same slowdown as 'Manufacturing'. Optimism in 'Services' about the next six months had plunged to the fifth lowest level in almost eight years and was below even that of the 'ManufacturingSector', according to the research. But 'Manufacturing' and 'Services' have both reported optimism over their ability to recruit staff over the next three months. Chief economist of Lloyds TSB Scotland ProfessorMr.Donald Macrae, said:
'The Scottish economy has caught some of the UK's cold but continues to show positive growth. 'Relatively low interest and inflation rates, coupled with low levels of unemployment, continue to maintain Scottish consumer confidence. 'The UK slowdown has now reached the Scottish service sector but growth should still lie between 1.75 per cent and 2 per cent in 2006.'
All is not gloomy, he pointed out, as the fall in demand for consumer credit and housing finance in the rest of the UK had not yet spread to Scotland. 'Scottish economy 'catches cold'', BBC News, 2006/01/04 08:16:01 GMT

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