NatWest UK regional PMI report for July 2023

Just half of UK regions in growth territory in July amid signs of demand weakness. 

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Key findings

  • New business falls in majority of regions and nations in July
  • Nine out of 12 monitored areas report higher employment
  • Rates of output price inflation slow in most cases


The number of UK regions reporting growth in business activity fell to the lowest in six months in July, according to the latest NatWest Regional PMI® survey, amid a broadening decline in demand. Trends in employment were comparatively more resilient, with the majority of areas seeing workforce numbers rise. Meanwhile, price pressures generally remained elevated, although slower increases in prices charged for goods and services were recorded in most cases. 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. Only half of the 12 monitored regions and nations recorded growth in business activity in July. London posted the strongest rate of expansion but saw a notable loss of momentum as growth slowed to a six-month low (business activity index at 52.3). The South East (49.6) and Northern Ireland* (48.2) fell the joint-most places in the rankings as both returned to contraction territory, though the steepest overall decline in activity was recorded in the North East (46.8).


Sebastian Burnside, NatWest Chief Economist, commented:

"Latest PMI data showed mixed fortunes for the UK's regional economies at the start of the third quarter, with half seeing a rise in a business activity and the remainder recording a contraction. These are the worst set of results since January. Furthermore, even in areas where output did rise, growth was often driven by work on outstanding business rather than new demand, which doesn't bode well for the outlook. "Employment remained a bright spot for most areas, with nine of the 12 monitored regions and nations seeing a rise in staffing levels. However, that was the fewest since March and rates of job creation often slowed, which raises some questions around the labour market's resilience in the second half of the year. "There were both positive and negative takeaways on the inflation front as well. Rates of input cost inflation ticked up in most cases in July, which tended to keep them above their historic averages and led to firms once again raising their own prices. On the other hand, rates of increase in prices charged for goods and services slowed in the majority of areas, with growing competition for new work amid a backdrop of cooling demand restricting firms' pricing power."


Please see the regional reports in full:


UK National (PDF, 246KB)

North East (PDF, 372KB)

North West (PDF, 364KB)

Yorkshire and the Humber (PDF, 381KB)

East Midlands (PDF, 404KB)

West Midlands (PDF, 377KB)

East of England (PDF, 383KB)

London (PDF, 351KB)

South East (PDF, 391KB)

South West (PDF, 384KB)

Scotland (PDF, 362KB)

Wales (PDF, 380KB)

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