North East private sector firms enjoyed solid and historically elevated increase in incoming new business in August, leading to an accelerated rise in employment levels. Elsewhere, output across the region rose only marginally and confidence towards future activity levels faded notably.

North East private sector firms enjoyed solid and historically elevated increase in incoming new business in August, leading to an accelerated rise in employment levels. Elsewhere, output across the region rose only marginally and confidence towards future activity levels faded notably.

The seasonally adjusted Input Prices Index posted above the neutral 50.0 mark in August, to signal sustained cost pressures faced by North East firms. Wage and raw material hikes were among those mentioned in panel member reports. Though still sharp, the rate of cost inflation fell to its lowest in just shy of four years.

In response, North East private sector firms were less aggressive in their price setting in August. The rate of charge inflation was the least pronounced of the year so far and solid overall.

Malcolm Buchanan, Chair of the NatWest North Regional Board, commented: "The North East economy continued to expand, but at a slower pace in August, according to the latest NatWest Growth Tracker data. Firms reported healthy inflows of new business that, despite easing from July, remained elevated by historical standards and slightly stronger than the national average. There was further promise with regards to jobs in the region. Hiring activity picked up slightly and jobs growth locally was one of the fastest of the 12 UK areas. Cost pressures faced by companies cooled to their softest for nearly four years and charge inflation eased. Despite the generally positive results, North East businesses expressed the weakest confidence in the outlook of the 12 monitored UK regions and nations in August."

Notably, the marginal increase activity in the North East was the slowest of the 12 UK areas monitored. With respect to new business, the rate of increase seen locally was solid and fractionally faster than the UK average.

Of the 12 monitored UK regions and nations, North East businesses were the least optimistic towards future activity, however.

August survey data highlighted another drop in outstanding business across the North East, thereby extending the current run of declines to 32 months. Survey respondents noted that they were able to catch up on backlogs of work. As well as solid, the rate of depletion was the quickest in four months and equal to the UK average.

Only Northern Ireland recorded a quicker rise in employment numbers than that seen locally.

On the price front, the rate cost inflation in the North East posted below the UK average. Meanwhile, of the 12 monitored UK areas, only firms in the South West and North West raised selling prices at a sharper rate than in the North East.