DUBAI, Sept 5 (Reuters) – Saudi Arabia’s non-oil private sector expanded in August at its fastest rate since October last year, as business activity was boosted by improving demand conditions, a survey showed on Monday.
The seasonally adjusted S&P Global Saudi Arabia Purchasing Managers’ Index (PMI) for the whole economy climbed to 57.7 in August from 56.3 in July, breaking above the series average since 2009 of 56.8. Readings above 50.0 indicate expansion in activity.
“The Saudi Arabia PMI pointed to added resilience in the non-oil economy during August, as business activity and sales continued to rise sharply despite reports of mounting global economic distress,” wrote David Owen, economist at survey compiler S&P Global Market Intelligence.
“Total new orders rose at the quickest pace since October last year, driven by improving client demand, higher exports, and a broad recovery in economic conditions since the pandemic.”
A strong increase in new export orders fuelled the rise in new orders, although they rose at a slightly softer pace than July’s eight-month high.
The output sub-index, which measures business activity, rose to 61.5 in August from 59.9 in July, roughly in line with the series average of 61.4.
The rise in input costs decelerated for a second consecutive month, roughly in line with the series’ average.
The employment sub-index rose for a fifth straight month, though only marginally and at a fractionally slower pace than in July.
The future output sub-index, measuring expectations for activity in the next 12 months, slipped to a three-month low but remained positive.
“The degree of positivity slipped for the second straight month, but was still one of the highest seen over the past year-and-a-half. Firms that gave a positive outlook for the next 12 months often based this on rising new order inflows, with some noting that upcoming projects and quality improvements could also support activity,” the report said.
(Reporting by Yousef Saba; Editing by Hugh Lawson)