REPORTS of rising activity and optimism from firms in a range of sectors, in Scottish Chambers of Commerce's latest quarterly survey, make welcome reading.

And Scottish Government figures yesterday showed the economy north of the Border grew by 0.7% in the third quarter - an above-trend pace.

Scottish Chambers' survey, published today, signals solid increases in activity in the manufacturing, construction, retail and tourism sectors.

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But the business organisation is not getting carried away with its positive survey findings.

In particular, Scottish Chambers highlights a further deterioration in cash flow for Scottish manufacturers and the consequent need to ensure that there is sufficient availability of funding to enable firms to invest in capacity to meet rises in demand.

It also flags the continuing weakness of growth in Scottish manufacturers' exports, noting tough conditions in key eurozone markets.

These two observations are astute.

And they highlight the key problem with the recovery so far, both in Scotland and the UK as a whole.

In contrast to the Coalition Government's declared strategy, the recovery has been driven in large part by hard-pressed consumers, who still collectively have high levels of debt, rather than by business investment and exports.

We should not underestimate the seriousness of this lack of balance in the recovery. And we would do well to heed Scottish Chambers' warning that the recovery is fragile.