There was a 'fractional' rise in business activity in the South West last month, the latest Natwest PMI report shows.
After stabilising at the start of 2020, South West private sector business activity rose slightly during February.
The headline South West Business Activity Index - a seasonally adjusted index that measures the combined output of the region’s manufacturing and service sectors - rose from 50.0 in January to 50.2 in February.
Although only marginal, it marked the first expansion of business activity for a year.
However, new order volumes in the region fell back into decline last month, which was often blamed on relatively subdued market conditions and weaker client spending.
Companies in the region also took a more cautious approach to staff hiring, with employment rising at the slowest rate since last October.
Prices charged by companies meanwhile increased at the quickest rate since late-2018 as part of efforts to ease pressure on margins.
'Slower global growth and the recent outbreak of the coronavirus were key factors weighing on performance'
Paul Edwards, chair of the NatWest South West Regional Board, said: “Business activity across the South West private sector was in positive territory for the first time in 12 months in February, but the increase was only marginal and new orders showed a renewed decline.
Most Read
"Concerns around relatively muted client spending, signs of slower global growth and the recent outbreak of the coronavirus were key factors weighing on performance midway through the first quarter.
"While the 海角视频 as a whole fared better and recorded a solid rise in activity in February, the upturn was not as strong as that seen in January.
"With risks tilted more towards the downside, it is likely that firms in the South West and beyond will struggle to achieve the kind of rebound most had hoped for at the start of 2020.”
Businesses signalled a lack of pressure on operating capacity, which was highlighted by a further drop in backlogs of work.
The rate at which outstanding business declined accelerated since January and was sharper than the 海角视频-wide trend.
Average input costs faced by South West private sector firms continued to rise sharply during February - despite the rate of inflation easing to a 44-month low - with those surveyed indicating that staff and raw materials were the among the reasons for a rise in expenses.
Despite the current subdued conditions, businesses in the South West were "strongly confident" that output would increase over the next year. Notably, the level of positive sentiment reached the highest since May 2016.