#Saudi PMI falls in July on weaker output growth, job creation | ZAWYA MENA Edition

Saudi PMI falls in July on weaker output growth, job creation | ZAWYA MENA Edition

While Saudi Arabia’s non-oil economy expanded at the start of the third quarter, output grew at a slower pace and staffing levels increased only marginally, the latest survey of purchasing managers showed Tuesday.

The headline seasonally adjusted IHS Markit Saudi Arabia Purchasing Managers’ Index (PMI) fell for the first time in four months to 55.8 in July from 56.4 in June.

The dip was driven by weaker growth in output, new orders and employment compared to the previous month. “Nevertheless, the reading pointed to a strong improvement in operating conditions that extended the current run of growth to 11 months,” the report said.

Job creation slowed in the non-oil sector as firms continued to signal an excess of business capacity despite rising sales. Backlogs were reduced solidly, suggesting a wide gap between demand and full capacity in spite of a sharp increase in new orders in recent months

Employment prospects were also harmed by a drop in future output expectations to the joint-weakest for more than a year.