RIYADH: Saudi Arabia saw a robust improvement in business conditions across the non-oil sector in June, according to the latest Purchasing Managers Index data report from S&P Global.
The report said new business rose at the sharpest rate for eight months, despite evidence that intensifying cost pressures had led companies to mark up their prices.
David Owen, economist at S&P Global Market Intelligence, said: "Saudi Arabia's non-oil economy continued to go from strength to strength in June, with the PMI picking up to an eight-month high of 57.0 and posting well above the 50.0 no-change mark.”
He said the upturn was underlined by a robust increase in new business levels, which encouraged firms to expand their output sharply and make greater input purchases.
The output levels in Saudi Arabia expanded in the second quarter of 2022, with more than 28 percent of the firms that took part in the survey reported a rise in May.
Business confidence also heightened to the uppermost level since the beginning of 2021, recorded the report.
At the same time, the report conveyed Saudi Arabia’s rapidly rising costs, an increase in the prices of raw materials and fuel, as global supply shrunk and consequently inflated output prices.
“While some companies reported concerns that sustained price rises could put a brake on the current path of growth, the latest survey data signaled overall output confidence picking up to a 17-month high” stated Owen.
The non-oil private sector’s inventory levels continued to rise as businesses were able to meet the growing demand despite cost pressures.
According to the S&P report, the supplier delivery times continued to shrink for the fifth month, the level of employment increased for the third month, whereas the rate of job creation fell slightly.