Saudi non-oil private sector grows solidly in May, steady from April

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Saudi non-oil private sector grows solidly in May, steady from April - PMI© Reuters. FILE PHOTO: Vehicles drive previous the King Abdullah Monetary District in Riyadh, Saudi Arabia, November 12, 2017. REUTERS/Faisal Al Nasser

DUBAI (Reuters) – Saudi Arabia’s non-oil personal sector continued sturdy progress in Might, notching its twenty first consecutive month of enlargement, as demand withstood rising output prices, a survey confirmed on Sunday.

The headline seasonally adjusted S&P World (NYSE:) Saudi Arabia Buying Managers’ Index (PMI) for the entire financial system was regular at 55.7 in Might, the identical as in April, which was its lowest studying since January and under the collection common of 56.8.

The output sub-index, which measures enterprise exercise, fell barely to 59.3 in Might from 59.7 in April, which was additionally the slowest tempo of progress since January. It was under the collection common since 2009 of 61.4.

“The continued energy of the home non-oil financial system inspired companies to pass-through larger enter prices to their prospects in Might, with the most recent PMI knowledge indicating one other stable improve in promoting costs attributable to better gas, materials and transport prices,” wrote David Owen, economist at survey compiler at S&P World Market Intelligence.

“Buyer demand seems to be responding nicely to cost mark-ups to this point, with one other marked improve in new orders recorded in Might, resulting in a strong enlargement in enterprise exercise,” Owen stated.

“Nonetheless, this will likely begin to change as world inflation builds and family prices rise, significantly as world provide chains stay below appreciable stress from lockdowns in China and the Russia-Ukraine warfare.”

The output costs sub-index confirmed the tempo of value will increase slowed from April however remained stable, falling to 52.7 in Might from 53.4.

Employment progress dipped marginally however remained in progress territory, the place it has been every month since April 2021, excluding March this 12 months.

As provide chains stay strained, together with attributable to lockdowns in China and the Russia-Ukraine warfare, “the outlook for future exercise remained notably weak, with simply 11% of respondents signalling expectations of an increase in output by Might 2023, lower than half the survey’s long-run pattern,” Owen stated.