Riyadh – Mubasher: The IHS Markit Saudi Arabia Purchasing Managers' Index (PMI) recorded a seasonally adjusted 56.9 reading in December 2019, its lowest since last July.
The index decreased by 1.4 compared with its level in November at 58.3, which was the highest reading in 51 months.
Nonetheless, the figures for last month showed the Saudi private non-oil sector is maintaining growth, as indicated by any reading for the index above 50, but at the slowest pace in five months.
“The latest Saudi Arabia PMI points to a short-term setback for the non-oil private sector, with the growth of business activity and new work slipping since November. However, the survey continues to indicate a much stronger improvement in business conditions than at the same time during 2018, particularly in relation to new order books,” Tim Moore, Economics Associate Director at IHS Markit, commented.
The IHS Markit December survey showed that business activity registered 58.1, its lowest level since October 2018. Meanwhile, the new orders index stood at 64.2 last month, while employment reached 50.5.
On the price front, input costs increased marginally during December, as inflation rate was at its lowest in four months, which IHS Markit says reflected a slower rise in average staff salaries.
“Latest data also suggests that non-oil firms in Saudi Arabia are confident about the outlook for 2020, with business optimism holding at a much higher level than seen in the middle of last year,” Moore added.
Non-oil private sector companies remain optimistic about their growth prospects for the next 12 months, with hopes of an improvement in underlying economic conditions and a corresponding rise in new business opportunities, according to IHS Markit.
Recent data by the Saudi General Authority for Statistics (GaStat) showed that during the third quarter (Q3) of 2019, the Saudi private sector achieved its highest growth since 2014, expanding by 4.22% and achieving its highest GDP value at SAR 272.63 billion.
