Emirates NBD's Purchasing Managers' Index (PMI) suggests that foreign demand has improved, with a notable increase in orders from the rest of the GCC
Business conditions in Saudi Arabia’s non-oil economy showed “solid improvement” in July, according to new statistics from Emirates NBD’s seasonally-adjusted Purchasing Managers’ Index (PMI).
According to the data, Saudi non-oil private sector firms continued to report marked growth in July, although the rate of expansion cooled “fractionally” from June. Emirates NBD said that many survey respondents attributed the higher activity to solid inflows of new business.
Despite the growth of output, Saudi businesses reported the third sharpest build-up in backlog of work in the survey’s history, with some firms reporting that delays in ongoing projects have lead to an increase in work outstanding.
Additionally, total new orders were found to have remained high in July, extending the current phase of growth to three months. Saudi businesses reported that foreign demand has improved, with a notable increase in orders from other countries in the GCC.
Job creation was found to be subdued, with only a slight increase in employment, matching that recorded in June.
The data also showed a softer increase in cost burdens in July, which Emirates NBD said was a reflection of easing input price pressures, with some firms seeking to increase client demand by offering price discounts.
Lastly, business confidence in the non-oil private sector was found to be subdued compared to the rest of 2018, even though it remained positive overall.