Aug 04 2011
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Saudi private sector expansion slows down
RIYADH: The Saudi British Bank (SABB) has published the results of the headline SABB HSBC Saudi Arabia Purchasing Managers' Index (PMI) for July 2011, a monthly report issued by the bank and HSBC.
It reflects the economic performance of Saudi Arabian nonoil 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.
Saudi nonoil private sector companies recorded further growth of new business in July, which respondents linked to favorable market conditions, good demand and new product launches. However, the rate of expansion slowed noticeably from June's near-record high to a nine-month low. This was despite a faster increase in new export business. New work from abroad rose at an unprecedented rate in the latest survey period.
In line with a weaker trend in new order growth, output rose at a much slower pace during July. Nevertheless, activity continued to expand at a robust pace. Medium-sized firms registered a stronger increase in output than small or large companies.
Unfinished business continued to accumulate during July. However, the rate of increase remained only marginal and much weaker than the average for the past year.
To manage current workloads and company expansions, as well as to comply with the government's new Nitaqat system, firms recruited additional workers in July. Employment rose solidly, but at a milder rate than in the previous four months.
Buying activity increased at a much slower rate in July, reflecting an easing trend in new order growth. Input stocks continued to rise solidly.
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