Saudi business activity rises to 3-month high
Riyadh, July 4, 2011
Business activity in Saudi Arabia's non-oil private sector edged up to a three-month high in June after four consecutive monthly declines, while job creation and input inflation slowed, a survey showed on Monday.
The SABB HSBC Saudi Arabia Purchasing Managers' Index (PMI), which measures activity in the Opec member's manufacturing and services sectors, rose to 62.8 in June from 62.6 in May.
The seasonally adjusted index for the world's top crude exporter is holding well above the 50 mark that separates growth from contraction.
The survey of more than 400 private companies, which started in August 2009, also showed new orders rising to 72.7 in June, their highest level in five months.
Saudi non-oil private sector firms continued to recruit new employees in June, though at a weaker rate than in May.
Concerned by unrest in the region, Saudi Arabia plans to spend an estimated $130 billion, or nearly 30 percent of its economic output, to ease social tensions, building new homes and hospitals.
It also wants to tighten enforcement of its quota system to boost employment of Saudis in the private sector, where only 10 percent of citizens work.
Overall input price pressures eased in June, reflecting less marked increases in both purchasing and staff costs, although they remained elevated by historical standards, the survey showed.
Output price inflation eased in June but also stayed above its long-run trend. Inflation in the biggest Arab economy slowed to a 15-month low of 4.6 percent on an annual basis in May, although analysts expect price pressures to pick up again. - Reuters