Saudi Arabia's non-oil private sector accelerated its growth in June, driven by a strong recovery in new business volumes. The seasonally adjusted Purchasing Managers' Index (PMI) released by Riyad Bank rose to 53.3 points in June, reaching its highest level in four months. The index, which stood at 52.8 in May, indicated a marked improvement in operating conditions at the end of the second quarter.
New business volumes recorded their fastest increase since February. Easing geopolitical concerns boosted investor confidence and stimulated domestic spending. Riyad Bank Chief Economist Naif Al-Ghaith said, 'The rise in output and the fastest increase in new orders in four months show that business activity is gaining momentum as we approach the end of the second quarter.'
Output growth remained broadly stable, with around 18 percent of surveyed companies reporting an increase in activity. In contrast, only 2 percent recorded a decline. Respondents cited the approval of new projects, rising customer demand, and the return of orders previously postponed due to regional conflicts as the main drivers of growth.
However, export orders contracted sharply for the fourth consecutive month due to logistical obstacles and intense external competition. Employment remained stagnant.
Meanwhile, input costs recorded their highest quarterly increase in 15 years. This forced companies to raise output prices at the second-fastest rate in nearly six years.