Saudi PMI rises to 6-month high as non-oil growth accelerates
- Saudi Arabia's non-oil private sector growth reached its fastest pace in six months with a PMI of 53.8 in August, up from 53.1 in July.
- Output expanded at its strongest pace in seven months, while new orders increased for the fifth consecutive month, despite a sharper decline in export orders due to regional tensions.
- Official estimates show Saudi Arabia's real GDP contracted 4.8% year-on-year in Q2 2026, primarily due to a 24.7% drop in oil activities, although non-oil activities grew at a slower rate of 0.6%.
- Business confidence rebounded to a seven-month high, with a significant portion of firms expecting increased activity over the next year.
- Employment increased for the second straight month, with modest job creation amid persistent cost pressures driven by material and transportation expenses.
- The non-oil growth trend in Saudi Arabia is mirrored by improvements in other Gulf economies, such as the UAE and Egypt, where their PMIs also indicated stronger business conditions.
