THERE has been a slight increase in Scottish private sector output, according to figures from the Bank of Scotland.

The bank’s purchasing managers’ index (PMI) data for June showed growth in the service sector remained unchanged since May while manufacturing expanded at a slower rate.

Input and output price inflation eased slightly in the same month, though input inflation remained high.

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Seasonally-adjusted figures showed a single-figure measure of the month-on-month change in combined manufacturing and services output, which fell to 51.1 in June from 51.5 in May.

This signalled modest output growth that was below the survey’s historical average.

The index showed manufacturers increased their output at a steady pace.

Although the rate of expansion eased since May, production growth remained higher than business activity in the service sector.

The figures showed there was a return to employment growth in June. Job creation was consistent across both sectors and faster among manufacturing companies.

Scottish employment growth, however, remained weaker than the whole of the UK.

Input price inflation remained strong in the latest survey. There was also evidence linking rising input costs to pay pressures and the weak pound.

Fraser Sime, regional director, Bank of Scotland commercial banking, said: “Scotland’s private sector output growth reduced slightly at the end of the second quarter.

“Manufacturing, which was previously a key driver behind private sector growth, softened in June.

“The services sector remained subdued overall and with an unchanged rate of expansion since May.

“However, there was also some positive news. Employment returned to growth and input price inflation further decreased in the latest survey.

“In addition, June’s data extended the current sequence of expansion to seven months, the longest recorded for almost two and a half years.

“Finally, business confidence fell in June, although to a lesser extent than seen across the UK as a whole.”

Economy Secretary Keith Brown said: “The latest Bank of Scotland PMI figures signal expansion in Scotland’s private sector in every month, for the first half of this year.

“The survey also signals that companies across Scotland have seen increased employment numbers alongside new business and order growth.

Business sentiment remains positive with future output expectations on the rise.

“It is a further vote of confidence in the Scottish economy, coming on the back of GDP figures that show growth four times that of the UK figure over the first three months of the year, with unemployment also at a record low of 4 per cent.

“While this is encouraging, Brexit uncertainty continues to cast a shadow over the future economic outlook, threatening jobs, investment and living standards.

“The Scottish Government will continue to use all of the powers at our disposal to grow the Scottish economy.”

The Scottish economy grew by 0.8 per cent during the first quarter of 2017.