The seasonally adjusted Riyad Bank Saudi Arabia Purchasing Managers’ Index (PMI), which was previously known as the S&P Global Saudi Arabia PMI, climbed to 54.8 points in August 2024.
In this month, the non-oil private sector in Saudi Arabia continued to show improvements in business conditions, with firms making greater efforts to bolster their operational capacities.
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According to the PMI, job creation was a prominent aspect of this upward trend, with employment figures rising at some of the highest rates seen in the past decade. Additionally, purchasing activity and inventory levels increased in response to strengthened company expectations, along with a slight rise in new order growth.
However, the overall growth momentum was slower when compared to recent trends, with the output of the non-oil private sector expanding at one of the weakest rates since early 2022. Consequently, companies lowered their selling prices for the second month in a row to stimulate demand. Although profit margins contracted, the reduction was less pronounced than in July, primarily due to a deceleration in the rise of purchase costs.
In the middle of the third quarter, Saudi non-oil businesses significantly boosted their activity, driven by an influx of new business opportunities. Firms generally reported receiving orders from both new and existing clients, benefiting from increased government investment. Furthermore, there was a substantial rise in external sales.
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