Saudi business confidence slightly wavers
Riyadh, June 22, 2010
Banque Saudi Fransi said greater global economic uncertainty in light of the euro zone debt crisis and volatility in oil prices over the last two months has taken a toll on sentiment among Saudi business executives.
The BSF Business Confidence Index, which attempts to gauge market sentiment on a quarterly basis, fell to 99.8 points in the third quarter, from 100.7 points in the second quarter, chief economist John Sfakianakis said.
He also said business executives have adopted greater caution in their outlooks for financial performance, bank lending, investment strategies and hiring plans.
With lower oil price expectations in mind, fewer businesses are confident that sales will improve in the coming two quarters, Sfakianakis said.
More executives are choosing cash and bonds as their top investment picks in next two quarters, highlighting risk aversion, he said.
However, the economist added: "Greater vigilance does not mean businesses are bearish, only that they are mindful that the global recovery is going to be bumpy rather than smooth." - Reuters