Saudi non-oil private sector keeps up solid growth in March – PMI

DUBAI (Reuters) – Saudi Arabia’s non-oil personal sector stored up its stable tempo of development in March as output expanded on the quickest price in over 4 years, a survey confirmed on Tuesday.

The headline seasonally adjusted S&P International Saudi Arabia Buying Managers’ Index (PMI) for the entire economic system rose to 56.8 in March from 56.2 in February, precisely in step with the collection common since August 2009.

“The Saudi Arabia PMI continued to sign sturdy development within the non-oil economic system in March, as new enterprise and exercise rose sharply in step with recovering shopper demand,” wrote David Owen, economist at survey compiler S&P International.

“Provide chains additionally displayed energy, with lead occasions shortening to the best extent for 3 years. In flip, firms raised their buying on the quickest price since December 2017, supporting greater capability ranges.”

The output sub-index rose to 62.4 from 60.4 in February, above the collection common of 61.4. New orders additionally rose and new export orders returned to development after two months of contraction.

Sentiment concerning output over the following 12 months remained in development territory, although much less so than in February and beneath historic developments. About 14% of respondents anticipated greater output within the subsequent yr.

The employment sub-index dipped beneath the 50.0 mark into contraction territory for the primary time in a yr.

“Sector-level knowledge indicated that reductions in staffing at building and wholesale & retail companies contrasted with expansions in companies and manufacturing,” the PMI report stated.

Price pressures within the kingdom elevated in March as already excessive commodity costs turned risky following Russia’s invasion of Ukraine. Employees wages additionally elevated, although marginally.

“Rising petrol and uncooked materials costs tremendously added to companies’ bills sheets. Nonetheless, with gross sales additionally enhancing, companies have been capable of improve their output costs accordingly – each prices and costs rose on the strongest charges since August 2020,” Owen stated.

(Reporting by Yousef Saba; Modifying by Hugh Lawson)