Saudi Arabia’s non-oil GDP up by 4.9 per cent

Non-oil PMI shows strong health, driven by job creation and rising new orders

Dubai: Saudi Arabia's non-oil gross domestic product (GDP) growth remained robust in the second quarter, with a year-on-year increase of 4.9 per cent, according to financial services firm Al Rajhi Capital Research.

Leading indicators, such as the non-oil purchasing managers index (PMI), show strong health, driven by job creation and rising new orders. Additional high-frequency data, including cement sales, up 4 per cent year-on-year in September, and consumer spending, up 7 per cent year-on-year, reflect a solid demand trend.

Non-oil PMI is a composite indicator designed to give an accurate overview of operating conditions in the non-oil private sector economy.

Al Rajhi’s report highlights the expansionary fiscal policy outlined in Saudi Arabia’s preliminary budget for 2025.

The country enjoys considerable fiscal flexibility, supported by a low debt-to-GDP ratio.

The oil market outlook, according to Al Rajhi, is influenced by two main factors: Geopolitical tensions and reduced demand from China. The report suggests that geopolitical issues are likely to exert upward pressure on oil prices for the rest of 2024.