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Non-oil business activity regained momentum in February 2024, recoveringfrom January’s slump, according to the Riyad Bank Saudi Arabia PMI (pdf) out yesterday. Headline PMI hit 57.2 last month on stronger demand, up from 55.4 in the previous month which marked its lowest reading in two years.
Output increased at the fastest pace in five months: Output came in at 61.5 in February, up from 58.1 in the previous month fueled by heightened demand, a vibrant tourism sector and a resilient construction sector, the report reads.
Exports orders drove an uptick in new orders to 62.2 in February, up from 60.5 in the previous month, signaling resilient “demand for domestic products from international markets and high competitiveness in local industries,” according to Riyad Bank Chief Economist Naif Al-Ghaith.
Purchasing activity remained strong as local firms ensured a steady inflow of inputs to secure lower prices from suppliers given the outlook on demand. This resulted in the sharpest increase in inventory levels since August 2022. Firms also witnessed an improvement in delivery times
Employment levels grew at one of their fastest rates in eight years, suggesting a higher demand for labor in a growing non-oil economy.
Easing inflationary pressures: Purchasing prices increased at their slowest rate in five months in february, and staff wages at their slowest in six months. Higher market competitiveness put a lid on selling prices in the same months.
AROUND THE REGION
- The UAE’s PMI (pdf) expanded to 57.1 in February, up from 56.6 in the previous month. This marks its fastest growth pace in five years on the back of rising demand.
- Egypt’s PMI (pdf) fell to 47.1 in February down from 48.1 in January, logging an 11-month low as inflation pressures and Suez Canal disruptions dampened demand and caused supply-side challenges.
