Consumer spending declined in Saudi Arabia on both yearly and monthly basis in February as recreational events were suspended due the rising cases of COVID-19 for most of the month.

“Looking ahead, we expect a pick-up in monthly and yearly indicators in consumer spending, with the latter being boosted by a lower base as a result of severe lockdowns during March to June of last year,” said Jadwa Investment in a note.

Overall consumer spending was down 4.4 percent year-on-year, and 14.3 percent month-on-month. This includes cash withdrawals from ATMs, the value of cheques cleared and point-of-sales (POS) transactions.

The Saudi government had imposed rolling lockdowns in the past 12 months in face of rising cases of the coronavirus. 

Meanwhile, a McKinsey & Company report this week based on a survey said that 72 percent of Saudi consumers are optimistic that the economy will rebound within 2-3 months and “remain just as strong or stronger than before COVID-19.”

The survey also found more Saudi consumers are making a portion of their purchases online than prior to COVID-19, with an increase in adoption of new shopping behaviors such as restaurant and grocery deliveries, because “they are still not yet fully comfortable going back to “regular” out-of-home activities.

(Writing by Brinda Darasha; editing by Seban Scaria)

brinda.darasha@refinitiv.com

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