Saudi August Non-Oil Business Growth Fastest Since July 2011

Saudi Arabia’s non-oil business activity grew in August at its fastest pace in more than three years, as rises in output, new orders and employment all gained momentum, a survey showed on Wednesday.

The seasonally adjusted SABB HSBC Saudi Arabia Purchasing Managers Index rose to 60.7 points last month – the highest level since July 2011 – from 60.1 points in the previous month. Any reading above 50 points indicates expansion; anything below, contraction.

The sub-index for output, at 67.4 points, was the highest since June 2011. The new orders sub-index at 69.4 points was the highest since September 2012. The employment sub-index, at 53.0 points, was the highest since March 2013.

Growth in new orders was bolstered partly by foreign markets, the survey showed, with the new export orders sub-index rising to 62.6 points. Companies reported their backlogs of work had fallen from the previous month’s high.

Overall input prices rose less quickly in August than in recent months, however, scoring 54.7 points compared with 56.4 points in July. The slowdown in price growth was driven by purchasing costs, for which the sub-index fell sharply; staff cost inflation accelerated slightly.