The data also indicates a broader downturn, with Gross Domestic Product (GDP) estimated to have contracted by 0.4% in the three-month period to May, a significant decline from the 0.4% growth recorded in the first quarter of the year.

The primary driver of the monthly decline was the manufacturing sector, which detracted 0.4 percentage points from the headline figure. The Scottish Government noted this was partly due to the cessation of oil refining at the Grangemouth facility. Providing a partial counterbalance, the professional, scientific and technical services sector was the largest contributor to growth, adding 0.2 percentage points to GDP.

Kevin Brown, a savings specialist at Scottish Friendly, observed that the contraction leaves the Scottish economy lagging behind the wider UK, which saw a smaller decline of 0.1%. However, he suggested the Grangemouth closure was a “single, large and one-off incident” that might skew the figures to “appear worse than might be more broadly apparent in the economy”. He pointed to buoyancy in other sectors as a reason for cautious optimism.

Looking ahead, Brown suggested that wider UK economic challenges could increase the possibility of an interest rate cut in August, which would make mortgages more affordable but would be “bad news for savers”.

Deputy First Minister Kate Forbes acknowledged the impact of Grangemouth on the figures and reaffirmed the government’s commitment to a “just transition” for the workforce, highlighting around £87 million in support for the industrial cluster. Ms Forbes argued that the statistics show the UK economy is “less productive and more unequal than independent European countries”, stating that “only the powers of independence will allow us to create a wealthier and fairer nation”.