London business activity growth gained momentum in April, rising at its fastest rate since December 2015 according to the latest Lloyds Bank Regional Purchasing Managers’ Index (PMI).
The London PMI registered 56.9 in April, up from 56.4 in March. A reading above 50 signifies expansion in business activity, and April saw the highest reading in 16 months due in part to an uplift in new business.
The Lloyds Bank PMI, or purchasing managers’ index, is the leading economic health-check of UK regions. It is based on responses from manufacturers and services businesses about the amount of goods and services produced during April compared with a month earlier.
Job creation in the capital increased at the start of the second quarter due to the growing demand for goods and services. The rate of employment growth was at its highest level since November last year.
London firms’ margins remained squeezed as input costs continued to rise sharply. In response, prices charged for goods and services increased at the fastest rate seen in 2017 so far.
Paul Evans, regional director for London at Lloyds Bank Commercial Banking, said: “The rising rate of business activity growth in London is encouraging to see, with new business increasing at the fastest pace for nearly two years.
“This momentum is thanks to the increasing demand for goods and services in the capital, which has had a knock-on effect on job creation.
“Rising costs aren’t harming firms’ plans for now, which is a positive sign for the rest of the year – although it remains to be seen how long that will last as the capital’s consumers start to feel the effects of inflation.”