Saudi Arabia private sector remains ‘robust’ despite slight slowdown

Growth in Saudi Arabia’s non-oil private sector slowed slightly in June as expansion of both output and new orders lost steam, a survey of businesses showed on Sunday.

The seasonally adjusted Emirates NBD Saudi Arabia Purchasing Managers’ Index fell to 54.4 last month from 54.8 in May. The 50-point mark separates expansion from contraction.

“The non-oil sector in Saudi Arabia is expanding at a robust rate, despite low oil prices, government spending cuts and more recently, higher interbank lending rates,” said Khatija Haque, head of regional research at Emirates NBD.

“Firms appear to be increasing operating efficiency, as jobs growth remains sluggish even as activity and new orders are rising.”

Output growth slowed to 58.6 in June from 60.6, while growth in new orders fell to 57.9 from 58.1. Employment growth slowed marginally.

Output prices rose in June for the first time in eight months, while input price inflation climbed to its highest level in seven months.

Some other economic data this year has suggested a deeper slowdown in the Saudi economy than the PMI figures. M3 money supply shrank from a year earlier for the fourth straight month in May.

Source: / Reuters

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