Manufacturing output stabilised in the quarter to January, following three consecutive quarters of decline, according to the latest Confederation of British Industry (CBI) quarterly Industrial Trends Survey for Scotland.
However, output is expected to return to sharp decline in the months ahead.
The survey was conducted between 16 December and 13 January, with 28 Scottish manufacturing firms responding. It showed an overall decline in total domestic and export orders, albeit at a slower pace than the previous three quarters.
Both are expected to decline at a sharper pace next quarter.
Headcount declined more rapidly than in the previous quarter and cost pressures rose sharply, putting pressure on margins, according to the CBI data.
Growth in average unit costs is expected to pick up even further in the next three months, with expectations at their highest since April 2013.
Investment intentions for the year ahead have turned positive across the board,