SCOTLAND’S private-sector economy achieved renewed growth in April, driven by the services sector as manufacturing output declined, a key survey shows.

Royal Bank of Scotland’s latest Purchasing Managers’ Index (PMI) for the economy north of the Border, published today, rose from 49.6 in March to 51 in April on a seasonally adjusted basis. This took it back above the level of 50 deemed to separate expansion from contraction.

However, Scottish companies were overall at their least confident for two-and-a-half years about the prospects for increased business activity on a 12-month horizon, albeit growth is still predicted over this timeframe.

Royal Bank said: “Some firms indicated economic uncertainty, particularly surrounding Brexit, remained of concern.”

Employment in Scotland’s private-sector economy grew at its fastest pace in six months in April, according to the survey. Both the manufacturing and services sectors increased staffing. Employment growth was faster in the services sector. Manufacturing returned to recruitment mode last month, having reduced employment in March.

Royal Bank said, while service providers mentioned improvements in demand, manufacturers reported weakness in the global goods-producing market.

Malcolm Buchanan, who chairs Royal Bank’s Scotland board, said: “At first glance, latest survey data for Scotland revealed an improvement in economic conditions, but upon closer inspection, we see that the upturn in April was solely driven by the service sector, as manufacturing weakness continued into Q2.”

Manufacturing orders fell for an eighth consecutive month in April, while services recorded a rise in new business.

Mr Buchanan said: “While service activity was given a boost by a small revival in demand, manufacturing output continued to lag as order book volumes shrank, with economic uncertainty and a sluggish global goods-producing market weighing.

“Firms recorded a cautious year-ahead outlook, with business confidence at a two-and-a-half-year low in April.”