London’s businesses grew at a faster rate than the UK average in May, according to the latest Lloyds Bank Regional Purchasing Managers’ Index (PMI).

Overall business activity maintained momentum, with the London PMI registering 55.7 in May, greater than the UK average of 54.4.

Growth cooled slightly from April’s high, when the PMI was at 56.9 — having been driven by a strong pipeline of new orders (a reading above 50.0 signifies expansion in business activity).

Rising new business demand has fuelled growth in the capital, resulting in the creation of new jobs, and employment levels have risen for the past seven months in a row.

Cost pressures for London firms eased slightly in May, and prices charged by businesses rose at the slowest rate seen since February.

Paul Evans, regional director for London at Lloyds Bank Commercial Banking, said: “Firms in London are reporting a healthy environment for business activity.

“Output growth in the capital, powered by strong demand for goods and services, is outpacing the rest of the UK and leading to solid jobs growth.”