Saturday 23 June 2018

Saudi, UAE non-oil business activity at new low

Dubai, May 7, 2013

The growth in non-oil, private sector business activity in Saudi Arabia slowed to a five-month low in April as a strong rise in new orders eased, a survey showed on Tuesday.

The seasonally adjusted SABB HSBC Saudi Arabia Purchasing Managers' Index fell to 58 points in April from 58.9 points in March; it was still well above the 50-point mark separating expansion from contraction.

Non-oil private sector companies in the world's top crude oil exporter reported a slowdown in new orders growth to 67.3 points in April from 68 in March. Growth in new export orders also eased. Output growth increased, however, to 62 points.

Employment growth slowed sharply to just 50.2 points in April, the lowest level since October 2011, from March's 53.4. This may have been the result of an intensifying crackdown on illegal foreign workers by Saudi authorities; tens of thousands have been deported in recent months.

Overall input price growth eased to 56 points in April from 56.7 in March, which was the highest level since last September, while output price inflation slowed marginally to 50.4 points.

Saudi Arabia's annual consumer inflation held stable at 3.9 per cent between January and March. The central bank said last week that inflationary pressures were set to rise in the second quarter of this year but inflation should stay limited.

A Reuters poll last week forecast Saudi consumer inflation of 4.5 per cent and economic growth of 4.1 per cent in 2013.

Also the business activity growth in the UAE's non-oil private sector eased slightly in April, touching a five-month low, as new orders rose at their slowest pace in a year, said the HSBC survey.

The PMI fell to 54 points last month from 54.3 in March.The adjusted index remains above the 50-point mark which separates growth from contraction, the survey of 400 private sector firms showed.
"It's another solid reading that strongly suggests the UAE economy is maintaining momentum well. The softer export reading is a concern, but overall new orders are still strong, employment is rising and output is up," said Simon Williams, chief economist for the Middle East at HSBC.
"We continue to look for overall growth of around 4 per cent this year, with Dubai likely to be the outperformer."
Output growth was little changed at 55.4 points in April, but new orders fell to 58.3 points, their lowest level since April 2012, from 60.2 in the previous month. Growth in new export orders dropped sharply to 51.8 points last month.
Employment growth across the UAE's non-oil private sector rose to a still-modest 53.3 points.
Output price growth remained below the 50 mark for the second consecutive month in April, and was as its lowest reading in 29 months. Growth in input prices edged up to 53.6 points.
Consumer price inflation in the UAE, the world's No. 3 oil exporter, climbed to 1.0 per cent on an annual basis in March, the highest level since September 2012, government data showed.
Analysts polled by Reuters in April forecast UAE gross domestic product growth of 3.3 per cent and inflation of 1.6 per cent in 2013.-Reuters

Tags: UAE | business | Nonoil |

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