Growth of business activity in Saudi Arabia’s non-oil private sector rose to a four-month high in August, a survey of more than 400 private companies has showed.
The SABB HSBC Saudi Arabia Purchasing Managers’ Index, which measures activity in the manufacturing and services sectors, stood at 57.7 points last month compared to 56.6 points the previous month.
The seasonally adjusted index remains well above the 50-point mark separating growth from contraction.
Output rose at an accelerated pace in August, as 22 percent of survey respondents reported higher activity.
Increased business was repeatedly mentioned as the main driver of the latest expansion. In line with stronger output growth was a solid rise in order intakes.
The latest increase was partly driven by improved market conditions, and increased marketing and sales efforts. Growth was the sharpest since April. Meanwhile, client demand from foreign markets also strengthened, the survey said.
Driven by higher purchase prices and increased staff costs, input prices in Saudi Arabia’s non-oil producing private sector increased at a sharp rate. According to anecdotal evidence, the rise in purchase prices was partly attributed to general economic pressures and increased market demand.
As has been the case for most of the survey history to date, employment levels rose in August. Companies that hired additional workers often commented on higher production requirements.
The SABB/HSBC Index also signaled an increase in sales, which was the main driver for the latest rise in purchasing activity. The latest rate of increase was in line with that seen in July.
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