Saudi Arabia: Non-oil PMI continues to climb in June
The Purchasing Managers’ Index (PMI), sponsored by Emirates NBD and produced by IHS Markit, rose from May’s 57.3 to 57.4 in June. The print represented the highest reading since December 2017. Therefore, the index remained well above the 50-threshold that indicates expansion in business activity in the non-oil producing private sector.
June’s reading mostly reflected stronger growth in new orders from both overseas and the domestic economy, which also propelled purchasing activity. Moreover, stocks of purchases increased in order to cope with greater costumer demand. Output growth, however, slowed to a three-month low in June. Despite the overall increase in non-oil private activity, private sector employment remained lackluster and slowed to a four-month low. In terms of prices, competition among suppliers continued to put a lid on inflation.
Looking forward, Khatija Haque, head of MENA research at Emirates NBD, commented that:
“Firms remained optimistic about future output, although this component of the survey declined to the lowest level since August 2018, possibly reflecting heightened geopolitical tension in the region.”