#Saudi non-oil business activity softens in August as output slows sharply-PMI | Reuters

Saudi non-oil business activity softens in August as output slows sharply-PMI | Reuters

The expansion in non-oil business activity in Saudi Arabia, the world's top oil exporter, eased further in August after output growth slowed sharply, a business survey showed on Tuesday, as concerns over market competition weighed on confidence.

The seasonally adjusted Riyad Bank Saudi Arabia Purchasing Managers' Index fell for a second consecutive month, dropping to 56.6 from 57.7 in July, although remaining firmly in growth territory. It was the lowest reading since September 2022.

Overall output growth slowed sharply, with the subindex dropping to 59.1 - the lowest level since January last year - from July's 66.0, while the new business expansion also eased.

The subindex for new orders slipped almost three points to 60.2 with greater competition and weaker export sales weighing on new business, the survey said.

Oil production cuts and lower crude prices this year will temper Saudi Arabia's economic growth, which hit 8.7% in 2022, but non-oil growth is expected to support the economy as it seeks to diversify away from hydrocarbons and expand the private sector.