The UK manufacturing sector slowed last year while commercial construction grew across all regions, agents from the Bank of England (BoE) have found.
The BoE’s statement, compiled from discussions with around 700 businesses, provides information on the state of business conditions, from firms across all sectors of the economy.
It found that general activity, from investment to production, had grown solidly from January 2015, and was expected to continue to do so over the coming months.
The exception was UK manufacturing, where output was down 1% on a year earlier and prospects for the sector were "subdued".
The bank’s agents said this largely reflected a slowdown in world demand for products, the strength of sterling and weak investment demand from the commodities extraction sector.
As a result, investment intentions had weakened in manufacturing, but continued to point to moderate growth among business services firms, consistent with the pattern of demand.
Construction output had continued to rise solidly on a year earlier, with commercial development activity becoming more widespread around the country.
Credit availability had remained above normal for larger companies, with strong competition to lend.
Access to finance for small companies was reported to be around normal.
The British Bankers Association (BBA) thought the credit results were encouraging, citing british banks’ central role in encouraging growth.
BBA chief economist Richard Woolhouse said: "Today’s agents summary makes it clear that credit conditions are improving. Banks are lending to businesses of all sizes right across the country, with strong competition between lenders.
"This underlines that banks are helping SMEs and larger companies do what they do best – drive economic growth and create jobs."
The BoE said the report does not represent the Bank’s own views, nor does it represent the views of any particular firm or region.
The Bank of England has Agencies for Central Southern England, the East Midlands, Greater London, the North East, the North West, Northern Ireland, Scotland, the South East & East Anglia, the South West, Wales, the West Midlands and Yorkshire & the Humber.
