Jul 04 2011
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SABB PMI Index for June: Record increase in export orders Nitaqat' boosts hiring of Saudis
The Saudi British Bank " SABB " has published the results of the headline SABB HSBC Saudi Arabia Purchasing Managers' Index™ (PMI™) for June 2011 - a monthly report issued by the bank and HSBC. It reflects the economic performance of Saudi Arabian non-oil producing private sector companies and establishments through the monitoring of a number of variables, including output, new orders, exports, input prices, output prices, quantity of purchases, stocks and employment.
The headline seasonally adjusted SABB HSBC Saudi Arabia PMI™ rose marginally in June, after falling over the previous four months. The latest reading of 62.8 (up from 62.6 in May) was the highest since March and signalled a further strong improvement in operating conditions across the KSA non-oil private sector economy.
Latest data signalled a pick-up in overall new business growth in June. The rate of increase was the most marked for five months, partly reflecting a series record increase in new export orders. Strong market conditions (both at home and abroad), company expansions and competitive pricing were all reasons for improved new business performance, according to respondents.
Backlogs of work were almost unchanged in June, following moderate growth in May. This was despite a stronger inflow of new orders. Anecdotal evidence suggested that the slowdown reflected efforts by some firms to keep on top of workloads.
Buying activity remained strong in June, with around 33% of monitored companies acquiring additional inputs to meet demand. Consequently, input stocks continued to build.
Efficient service, due to good business relationships and strong competition amongst suppliers, led to improved vendor performance in June. Lead times have shortened in every month of the survey history, although the latest improvement was slower than in May.
Overall input price pressures eased during the latest survey period, although remained elevated by historical standards. This moderation in inflation reflected less marked increases in both purchasing and staff costs. Output price inflation also eased in June but, like input price inflation, remained above its long-run trend.
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