Production activity of private oil sector in Saudi is declining
2023.01.03 02:21
Production activity of private oil sector in Saudi is declining
Budrigannews.com – A survey released on Tuesday revealed that growth in Saudi Arabia’s non-oil business activity slowed to a three-month low in December, despite higher sales and robust demand ensuring that businesses maintained their optimism regarding the outlook for the upcoming year.
From 58.5 in November, the seasonally adjusted Riyad Bank Saudi Arabia Purchasing Managers’ Index decreased to 56.9 in December. Despite being well above the 50 threshold that separates growth from contraction, it was the lowest reading since September.
The employment subindex rose to 52.0 in December from 50.6 in November, marking the fastest rate of job creation in nearly five years. The majority of businesses attributed this expansion to a growing number of new orders.
However, the output subindex decreased to 61 from 64.6 in November, and new order growth also slowed.
The Saudi finance ministry says that non-oil private sector activity is largely to blame for the increase in GDP growth in 2022, which has been revised up from earlier estimates.
According to Riyad Bank chief economist Naif Al-Ghaith, “We see operating conditions remaining favourable in December, characterised by rapid growth in the non-oil activities and a robust labor market by the end of 2022, with both jobs and wages having far more momentum than previously thought.”
“Overall, the data from December indicate that fourth-quarter growth will continue, which bodes well for the coming year. Because of this, we could confidently anticipate non-oil GDP growth exceeding 4% in 2023.”
Despite the fact that business certainty about the year ahead remained comprehensively sure on assumptions for expanded speculation and more grounded request, the level of certainty debilitated to a seven-month low in December.
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