Saudi Arabia’s non-oil business activity growth steady in April-PMI
2024.05.05 03:25
DUBAI (Reuters) – Saudi Arabia’s non-oil business activity grew at a steady rate in April despite a slowdown in new order growth, a survey showed on Sunday, with domestic demand driving output.
The seasonally-adjusted Riyad Bank Saudi Arabia Purchasing Managers’ Index stood at 57.0 in April, the same as March, and well above the 50.0 mark denoting expansion in activity.
The Output subindex retreated slightly to 61.9 in April from a six month high of 62.2 the previous month, but continued to reflect strong demand conditions, with Wholesale & Retail registering the strongest expansion in output.
“This uptrend hints at an anticipated spike in the non-oil GDP, likely exceeding the 4.5% mark for this year,” Naif Al Ghaith, Riyad Bank’s chief economist, said about the overall PMI.
“Noteworthy is the surge in new orders and inventory expansion, indicative of a proactive response to mounting demand within the market.”
New order growth slowed in April, registering a reading of 61.0 from 64.0 in March, but sales were supported by strong domestic business conditions, although export orders also remained in expansion mode, driven by the manufacturing sector.
Saudi Arabia’s economy contracted an estimated 1.8% year-on-year in the first quarter as a decline in oil activities continued to hurt overall growth.
Non-oil GDP grew 2.8% year-on-year, preliminary government data showed, although quarterly data indicated some softening in momentum with non-oil GDP up only 0.5% from the previous quarter government activities declining by 1%.
Still, the 12-month business outlook remained robust in April, with positive sentiment broad-based across sectors, the survey said.
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