NatWest UK regional PMI report for February 2023

Improving performances all round in February

Key findings

  • 11 out 12 monitored areas record growth; North East stabilises
  • New orders increase almost universally
  • Costs rise more slowly, though still steeply overall


Underlying demand perked up in almost all areas, leading to generally stronger optimism among firms. On the price front, charges for goods and services continued to rise sharply across the board, despite signs of easing cost pressures.

The PMI Business Activity Index is the first fact-based indicator of regional economic health published each month, tracking the monthly change in the output of goods and services across the private sector. A reading above 50 signals growth, and the further above the 50 level the faster the expansion signalled.

February saw a rise in business activity across all but one of the regions and nations monitored by the survey. The North East was the only exception, although output here did at least stabilise after a seven-month sequence of contraction (index at 50.0). London (56.0) recorded by far the strongest activity growth, registering its best performance since last July, with the South East (53.3) a distant second.

* PMI survey coverage in Northern Ireland includes construction and retail, as well as manufacturing and services


Sebastian Burnside, NatWest Chief Economist, commented:

"After a challenging start to the year when only one region (London) reported growth in activity, February's survey data showed a turnaround in fortunes, with almost every area of the UK back in growth territory. Encouragingly, upturns in activity were generally supported by greater inflows of new work.

"London was the standout performer in February, registering strong increases in both output and new work as well as a notable rise in backlogs of work, to suggest that the capital has decent growth momentum heading into March.

"Business confidence increased in most regions and nations in February and is now notably higher than last Autumn, amid a more settled political backdrop and easing recession concerns.

"Slowing rates of input cost inflation are another cause for optimism, even if they still remain high by historical standards. One area of continued strong cost pressures is wages, with a rise in employment in ten of the 12 monitored regions and nations in February indicating that labour market conditions remain tight.

"Rates of inflation in prices charged for goods and services remain stubbornly elevated, and even ticked up in three cases in February, to suggest little let-up in the rising cost of living."


Please see the regional reports in full:

UK National (PDF, 246kB)
North East (PDF, 372kB)
North West (PDF, 363kB)
Yorkshire and the Humber (PDF, 388kB)
East Midlands (PDF, 402kB)
West Midlands (PDF, 376kB)
East of England (PDF, 383kB)
London (PDF, 350kB)
South East (PDF, 399kB)
South West (PDF, 384kB)
Scotland (PDF, 366kB)
Wales (PDF, 378kB)

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