DUBAI - Growth in Saudi Arabia's non-oil private sector slowed slightly in December from an 11-month high the previous month, while the fourth quarter average remained above the trend in the first half of 2018, a survey showed on Thursday.
The seasonally adjusted Emirates NBD Saudi Arabia Purchasing Managers' Index dipped to 54.5 in December from 55.2 in November. A level above 50 indicates expansion.
The private sector has been struggling all year with the impact of fuel price hikes, the introduction of a 5 percent value-added tax and higher fees for hiring foreign workers.
"The renewed dip in the headline index following November’s 2018 high confirms this year as the weakest in the series, averaging 53.8 as compared to an annual average of 58.0 over the previous eight years," said Daniel Richards, MENA Economist at Emirates NBD.
"This indicates a fairly weak expansion in the non-oil private economy as compared to previous years, even despite the pick-up in oil prices enjoyed earlier in 2018."
The slowdown brought the fourth quarter average in line with the three-month average to September, both above the trend levels of the first half of the year.
The output subindex slipped to 58.2 from 59.3 while new orders fell to 58.4 from 59.2.
Employment growth in Saudi Arabia's non-oil private sector was only marginal in December, with the subindex slowing for the second month running to 50.5 from 50.7 in November. It was the weakest rate of job creation since April 2017.
Saudi officials have predicted a gradual acceleration of the non-oil economy next year.
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(Reporting by Davide Barbuscia; Editing by Hugh Lawson) ((Davide.Barbuscia@thomsonreuters.com; +971522604297; Reuters Messaging: email@example.com))