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30 May 2023

Saudi January PMI rises to record high of 63.8

Saudi job creation slowed slightly in January (AFP)

By Reuters

Business activity in Saudi Arabia's non-oil private sector rose to a series record in January but also saw input price inflation climb to its highest level, a survey showed on Saturday. 

The SABB HSBC Saudi Arabia Purchasing Managers' Index (PMI), which measures performance of the Opec member's manufacturing and services sectors, rose to 63.8 points from December's 61.3, the highest level since the series began in August 2009.

The seasonally adjusted index for the world's top crude exporter is holding well above the 50 point mark that separates growth from contraction. 

The private sector also saw record figures in January for both non-oil output levels and new orders at 73.2 points and 72.9 points, respectively. 

The survey of more than 400 private companies showed that Saudi job creation slowed slightly in January and was weaker than the series average. 

Non-oil private sector firms in the top Arab economy passed through part of their higher cost burdens to customers in January, raising their charges at a highest pace in seven months. Input inflation also surged. 

"A combination of increased demand for inputs and short supplies for certain commodities put upward pressure on purchasing costs in January, pushing inflation to a series record high," the survey said. 

Consumer inflation in the desert kingdom climbed to an 18-month high of 6.1 per cent last August, but has since eased to reach 5.4 per cent in December.

Saudi central bank governor said last month that he is worried about inflation as a global rise in food prices may drive it higher.