Business activity in Saudi Arabia grew at the fastest pace in seven years as fewer Covid-19 restrictions led to a boost in the non-oil economy. A Purchasing Managers’ Index compiled by IHS Markit rose to 58.6 in September from 54.1 during the previous month, the largest monthly gain in points on record. The acceleration was attributed to faster growth in new orders. After two successive falls, the latest reading showed that the economic recovery has stamina, and the relaxation of pandemic measures will release new waves of demand.
Overall cost pressures have remained modest so far but could intensify if raw material price rises spill over to more parts of the economy. In the UAE, the index posted a reading of 53.3 compared to 53.8 in August, remaining above the 50 mark that separates growth from contraction. In Egypt, the index declined to 48.9 from 49.8 in August, signaling the 10th straight monthly contraction as weaker customer demand took its toll on output and new orders. The confidence in future activity, however, rose to the highest level in the nine-year history of the series, coinciding with “a faster vaccination programme” and further easing of travel measures “that should aid tourism income in the fourth quarter.