South West Business Activity Shows Tentative Signs of Improvement
Business activity in the South West region of England has shown tentative signs of improvement, but remains patchy. The Bank of England's Regional Agents' summary indicates modestly firmer output growth and slightly better confidence.
The standout performer is manufacturing, driven by export-oriented firms in aerospace, defence, and equipment for energy infrastructure and data centres. This sector experienced a slight rise in output after last year's contraction.
Business services are also firmer, particularly in IT, tax, employment law, restructuring, and engineering consultancy. However, growth is often fee-led rather than volume-driven.
Consumer spending remains weak, with households prioritizing value amid squeezed budgets and geopolitical uncertainty. Supermarkets report weak food volumes as shoppers trade down, demand for big-ticket items tied to housing is soft, and hospitality faces challenging trading conditions.