ECONOMY

Saudi business activity growth at six-month high, says poll

SAAB HSBC reports a sharp increase in new orders among Saudi businesses. (Photo courtesy: Sabb online)

Growth in non-oil private business activity in Saudi Arabia accelerated to a six-month high in September as output prices rose for the first time since January, a survey showed on Thursday.

The seasonally adjusted SABB HSBC Saudi Arabia Purchasing Managers Index was at 58.7 points in September, well above the 50-point mark separating expansion from contraction, against 57.5 in August.

It was buoyed by a sharp increase in new orders and solid growth in output.

Output growth hit a five-month high of 60.9 in September, while new orders rose to an 11-month high of 68.8 from August's 66.3. New export orders were at 62.6, the fastest clip since the survey started in August 2009, against 56.0 in August 2013.

Output prices rose for the first time in eight months in September to 50.8, from 48.9 in August. Overall input prices continued to rise with the sub-index at 55.1, little changed from the previous month.

Business activity growth also accelerated in the United Arab Emirates, data released today show.

The HSBC UAE Purchasing Managers' Index, which measures the performance of the manufacturing and services sectors, grew to 56.6 points in September from 54.5 in the two previous months.

The adjusted index remains above the 50-point mark which separates growth from contraction, the survey of 400 private sector firms showed.

"It's an extremely strong reading that shows the UAE economy continuing to build speed," said Simon Williams, chief economist for Middle East and North Africa at HSBC.

"Output is high and new orders from home and overseas are robust, suggesting the economy is set to maintain momentum into the year-end."

UAE firms saw output growth accelerate to 57.9 points in September, the highest level since May 2011, from 56.6 in the previous month. New orders were at 65.0 points, the strongest level in the survey's 50-month history.


Growth in new export orders jumped to an eight-month high of 57.8 points. Employment growth across the UAE's non-oil private sector rebounded to 53.4 points from 51.5 in August, which was the lowest level since March 2012.


"The pick-up in job creation is consistent with the positive overall trend but the rise in wages may mean that price pressures are starting to build," Williams said. "Given rising rents, we fear inflation will be a matter of growing policy concern over 2014."


Output price growth was at 50.3 points for the second month in a row. But input price growth picked up to 54.8 points in September, the fastest clip since February, from 53.6 in the previous month.


Consumer price inflation in the UAE, the world's No. 3 oil exporter, held steady at a two-year high of 1.3 percent on an annual basis in August, government data showed last month
 

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Last Update: Thursday, 3 October 2013 KSA 17:19 - GMT 14:19
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