Saudi Arabia Non-Oil Private Sector Maintains Strong Growth Momentum

(RTTNews) - Saudi Arabia's non-oil private sector activity logged a further sharp expansion in March despite easing from the previous month, as output and new orders continued to rise markedly, survey results from S&P Global showed on Tuesday.

The Riyad Bank Purchasing Managers' Index dropped to 58.7 in March from 59.8 in February. However, a reading above 50 indicates expansion in the sector.

In March, there was a sharp upturn in new orders amid improving market conditions and increased development spending. Nonetheless, the overall growth in new business softened from February.

Consequently, production grew strongly, though slower than the prior month. Backlogs of work declined at the weakest rate in ten months, even though firms generally managed to keep up with workloads.

On the price front, input price inflation accelerated to a four-month high in March, led by rising costs for raw materials and staff wages. However, selling prices charged by non-oil companies rose only marginally.

"Despite the global headwinds including the recent credit crunch and heightened uncertainty, Saudi non-oil firms exhibited a robust degree of confidence towards future activity in March, " Naif Al-Ghaith PhD, chief economist at Riyad Bank, said.

"Supportive government policies along with improving demand levels have been grounds for this optimism."