Saudi Arabia Economic Outlook
November 3, 2020The contraction likely eased slightly in Q3 after Q2’s record GDP contraction due to flagging oil production and domestic lockdown measures. The year-on-year fall in oil production eased in Q3 as output rose in September for the first time since April. In addition, the non-oil private sector PMI averaged higher in Q3 and pointed to a stabilization in output, supported by easing lockdown restrictions, despite July’s VAT hike. Turning to Q4, however, a global surge in Covid-19 cases weighed on oil prices in October. Meanwhile, the government unveiled projections for next year’s budget in late September. The preliminary estimates show an approximate 7.3% spending cut and a 9.8% increase in revenues. The country plans to shift spending towards the sectors hit hardest by the pandemic to support the recovery, while prioritizing fiscal discipline.
Saudi Arabia Economic GrowthNext year, the economy should rebound robustly on the back of stronger oil production and as domestic demand recovers from this year’s lockdown measures, which have hampered investment and household spending. That said, a more restrictive budget, uncertainty around the evolution of the pandemic and volatile global oil prices pose downside risks to the outlook. FocusEconomics panelists see GDP growing 3.7% in 2021, which is unchanged from last month’s forecast. In 2022, the panel sees economic growth at 2.9%.
Saudi Arabia Economy Data
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Saudi Arabia Facts
|Bond Yield||2.49||0.0 %||Jun 23|
|Exchange Rate||3.75||0.0 %||Dec 31|
|Stock Market||0.2||1.00 %||Jan 07|
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Saudi Arabia Economic News
April 9, 2021
Oil prices fell in recent weeks, as OPEC+ agreed to ease its production cuts starting from the month of May.
April 5, 2021
The Purchasing Managers’ Index (PMI), produced by IHS Markit, fell from 53.9 in February to 53.3 in March.
March 31, 2021
The economy contracted 3.9% on an annual basis in the fourth quarter, after declining 4.6% in the third quarter.
March 15, 2021
Consumer prices decreased 0.13% over the previous month in February, contrasting January’s 0.22% rise.
March 5, 2021
Oil prices continued to rise in recent weeks, supported by positive developments on the Covid-19 vaccine front, the House’s approval of a third U.S. stimulus package, tighter supply—as Saudi unilaterally decided to cut production by an additional 1.0 mbpd in February–April.