Commercial activity in Saudi Arabia witnessed a rise at one of the fastest rates since the beginning of the Covid-19 pandemic.
According to the IHS Markit Purchasing Managers’ Index, the Kingdom scored 56.9 points during November 2021, which reflected a sharp improvement of the non-oil private sector economy.
Although it fell from 57.7 points in October and hit a three-month low, the index was in line with the 12-year average.
“The largest component of the headline PMI is the New Orders Index, which fell for the second month in a row from September’s seven-year high. Despite this, the index continued to indicate a robust upturn in new business volumes that was stronger than most of the recovery period since the initial COVID-19 lockdown,” according to IHS Markit Saudi Arabia.
According to the index, many members of the study committee linked the increase in sales to a return to normal economic conditions and an improvement in the tourism sector with the easing of travel procedures. In parallel, external demand improved with export orders rising to the highest level since May.
As a result, business activity in the non-oil private sector rose sharply in the middle of the last quarter. And the growth rate was slightly weaker than October’s highest level in four years.
Meanwhile, the rate of backlog decline was the slowest since the pandemic began. Companies noted that demand pressures were beginning to pressure the overall capacity.
The increase in production led companies to make further expansions in hiring and purchasing. Employee numbers rose at the fastest rate since June, but many companies remained cautious about their future sales outlook.
Commenting on the latest survey results, David Owen, Economist at IHS Markit, said: “The Saudi Arabian PMI continued to signal a strong end to the year for the non-oil economy. Despite slipping to a three-month low, new business growth was rapid overall, whilst activity expanded at one of the quickest rates since the start of the pandemic.”