• Business activity rises in six regions, down from ten in February
• London tops rankings for output growth but sees pace of expansion ease
• Business costs rise sharply in all areas - though longer term confidence remains stable/positive
• Private sector shows resilience as firms continue to grow and adapt despite heightened levels of economic uncertainty
• Employment growth confined to Northern Ireland, Scotland and North East
   

Following a more positive start to the year March saw momentum slow across the UK's nations and regions.

The Tracker's headline figure is the Business Activity Index. Any reading above 50.0 signals growth, and the further above the 50.0 threshold it is, the faster the rate of signalled growth.   

March saw a widespread loss of momentum across the UK's nations and regions, amid a surge in cost pressures and heightened uncertainty linked to war in the Middle East, the latest Royal Bank of Scotland Regional Growth Tracker showed.

Higher activity was recorded in six out of the 12 areas monitored, down from ten in February, with rates of growth slowing in each case.

London topped the regions rankings with a solid pace of expansion, ahead of Northern Ireland. Business activity growth was notably slower in the North East, West Midlands, East of England and Scotland.

Output fell elsewhere, with Wales and the East Midlands recording the most marked declines.
 

Commenting on the Tracker’s findings, Sebastian Burnside, NatWest Chief Economist, said:

"Following a positive start to the year, business activity softened in March, with geopolitical uncertainty contributing to slower growth or declines across regions.

"Firms all across the UK faced a jump in costs in March linked to the rising price of fuel, transport and raw materials, which have added to persistent wage pressures. The data show the widespread customer impact of higher costs via hikes in prices charged for goods and services, which point to inflationary pressures filtering through to the broader economy.    

"However, business confidence generally remained positive, but companies in most regions revised down their growth expectations in light of the generally more uncertain outlook and the spike in price pressures.

"There was a mixed picture for recruitment across the UK. Encouragingly, we saw employment tick up in three areas in March – which was the joint-most in over a year – though hiring remains subdued in most regions and will be steered by developments in business activity and costs in the coming months."

Please see the regional reports in full:

East of England (PDF, 913.1KB)

East Midlands (PDF, 945.7 KB)

London (PDF, 870.3 KB)

North East (PDF, 722.5 KB)

North West  (PDF, 966.9 KB)

UK National (PDF, 1 MB)

South East (PDF, 923.1 KB)

South West (PDF, 967.7 KB)

Wales (PDF, 949 KB)

West Midlands (PDF, 923.4 KB)

Yorkshire and the Humber (PDF, 2.8 MB)