Riyad Bank

Nov 6, 2023

Economy of Saudi Arabia Dubai – Al Arabiya.net Published on: November 05, 2023: 08:51 AM GST Last updated: November 05, 2023: 04:51 PM GST The Purchasing Managers’ Index of Riyad Bank in Saudi Arabia showed a noticeable increase in employment during the month of last October, in non-oil economy companies in Saudi Arabia. According to the index issued on Sunday, the strong rise in new businesses helped lead to a noticeable expansion in activity, which led to the largest improvement in job numbers in 9 years. The companies surveyed reported that strong demand and strong production expectations led to the need to increase employee numbers, and as a result, total employee numbers rose to the highest degree since October 2014. Strong labor market conditions helped lead to a faster increase in wages, increasing input cost pressures as purchasing price inflation also accelerated. However, companies cut selling prices for the second month in a row amid other reports that strong competition has eroded market share. The main reading is the Riyad Saudi Bank’s seasonally adjusted Purchasing Managers’ Index, which is the average of 5 indicators that include new orders 30%, production 25%, employment 20%, in addition to supplier delivery times 15%, and purchases inventory 10%. The main purchasing managers index rose for the second month in a row last October, rising from 57.2 points in September to 58.4 points in October. The reading was the highest since June and indicated a significant improvement in the conditions of the non-oil private sector in Saudi Arabia. Business activity continued to grow at a significant rate at the beginning of the fourth quarter, in response to increasing currency demands and improving economic conditions, and companies also reported a sharp increase in incoming new business, with the expansion rate improving to its highest level in 4 months. Growth in production and new business remained broad across the manufacturing, construction, wholesale, retail and service sectors. Riyad Bank’s chief economist, Nayef Al-Ghaith, said that the employment sector in the Kingdom witnessed an expansion that reached 59.5 points, and this includes the non-oil sector, and there is no difference between the industrial sector or services, supported by a significant expansion of demands, with expectations for future growth to cover demand levels. Backlog He added in an interview with Al Arabiya Business that the decrease in backlog of work is a good thing, and a number of establishments included in Riyad Bank’s survey of purchasing managers reported an improvement in the work environment and the completion of some work electronically, which made it easier for companies and reduced the occurrence of backlog of work. He pointed out that the readings of the Riyad Bank Purchasing Managers’ Index improved, and said that the Saudi domestic product is divided into oil and non-oil output, and the first witnessed a contraction of 4.5% during the third quarter, driven by a reduction in petroleum production, and currently about 9 million barrels are produced per day, compared to 11 million barrels in the corresponding period. From last year, it is expected that the low production of oil will continue, and thus the GDP of this sector will record a decline. He continued, “On the other hand, the non-oil GDP is expected to continue growing as shown in the Purchasing Managers’ Index and to approach 5% by the end of this year.”