The outbreak of coronavirus "notably impacted sales, input costs and tourism" in London in February despite a "steep improvement" in business activity, the latest in a series of major business surveys has shown.
The latest PMI survey data from NatWest showed a sharp rise in business output and optimism improving to a 55-month high, leading to a further uplift in employment.
That's despite the outbreak of the deadly coronavirus taking its toll. Companies reported that they were able to expand due to a solid improvement in total new orders, with some noting a post-Brexit surge in activity and investment.
But the survey did signal a slight impact from the outbreak of the new virus on output.
The seasonally-adjusted London Business Activity Index posted 56.0 in February, signalling a sharp expansion in private sector output.
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The rate of growth was slightly weaker than in January, with the index dropping from 56.5, but nonetheless stronger than the long-run average.
London also saw the fastest rise in activity of all 12 monitored 海角视频 areas for the fifth month running.
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Following a 32-month high in January, new order growth at London businesses eased in February, but remained solid overall.
Demand was driven higher by new projects and renewed investment growth, although tourism in the capital was notably reduced.
A softer rise in new work helped firms to curb capacity pressures in February.
The level of outstanding business grew marginally and at a much softer pace than in January, NatWest said.
Stuart Johnstone, London and South East's managing director of corporate and commercial banking, said: “London remained on a strong footing in February, with latest PMI numbers emulating January data and showing a steep improvement in business activity.
"Sales grew quickly again, though the rate of growth did soften, with particular weakness in tourism noted as firms saw a drop in travellers amid the Covid-19 outbreak.
"Should disruption continue into the summer, the capital could see a greater impact on tourism which many businesses rely upon for sales.
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“In the meantime, the city’s dominant service sector suggests that it is more isolated from supply chain delays than other areas of the 海角视频, which many manufacturers observed in February, so it is likely to continue outperforming the rest of the country – London saw the strongest rise in business activity for the fifth month running.
"That said, it is not immune to an economic impact from Covid-19, so forecasts of future growth should be treated with caution until we know the full effect of the outbreak on 海角视频 business.”