THE latest Purchasing Managers Index (PMI) report, the business survey data produced for The Royal Bank of Scotland by NTC Research, has shown a slight slowdown in growth in the south west.

RBS senior economist Robert Gardner said: "This slowdown was largely on the back of a less vigorous expansion in the manufacturing sector activity in the service sector continued to gain momentum.

"The outlook for the region remains bright.

"Volumes of incoming new business are growing and this should support job creation, helping to maintain the rise in employment evident since mid-2003."

Firms attributed continuing output growth to an increase in new orders, higher staffing levels and investment in new products.

Volumes of new business continued to rise for the 21st consecutive month in December and the pace of expansion remained robust.

Employment in the private sector rose for the 19th month in succession and at a rate well above the UK average.

However, the rate of job creation was less marked than in the previous month, as around four-fifths of firms left staffing levels unchanged.