Saudi PMI records first increase in 5 months at 56.2 points in February: IHS Markit

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Saudi Arabia Purchasing Managers’ Index (PMI) for February 2022 rose three points to 56.2 points – the first increase since September 2021, IHS Markit said in its latest report.

The latest reading indicates that the strong improvement in working conditions was the fastest in three months.

The improvement was driven by a surge in new business growth, after concerns about the Omicron variant led to a slow down at the year beginning. The growth acceleration was the first of its kind in five months, with the sales recovery was mostly linked to higher customer demand and lower numbers of COVID-19 cases.

Growth regained strength in the non-oil private sector in February, as improved corporate confidence and customer demand led to faster expansions in production, new businesses, and purchases, while cost inflation pressures receded for the second month in a row, amid expectations for future production to rise to their highest levels since the beginning of 2021.

Contrary to the overall sales trend, new export orders declined for the second consecutive month, while the Omicron wave continued to curb demand in some areas.

As new business growth improved, non-oil-producing activity increased further last month and companies were generally able to increase production in line with customer demand, resulting in a modest drop in accumulated work, the report said, noting that this occurred despite the fact that staff numbers rose only slightly, with some reports of staff shortages due to the pandemic.