The Purchasing Managers’ Index (PMI) for Riyad Bank Saudi Arabia experienced a dip to 55.6 in April 2025, down from 58.1 in March, marking the slowest growth in the non-oil private sector since August 2024. Despite this reduction, the index stayed comfortably above the neutral threshold of 50.0, indicating continued expansion. This deceleration was primarily attributed to a marked decline in new order growth, influenced by escalating global uncertainty and competition. Nonetheless, output saw a robust increase, supported by higher sales volumes, project approvals, and buoyant tourism activity, albeit at the slowest pace in seven months.
In reaction to these market conditions, employment saw a significant boost, with hiring activity reaching levels not seen since October 2023, particularly driven by strategic recruitment in the IT and marketing sectors. This surge, however, led to unprecedented levels of staff cost inflation, accompanied by a rise in purchase prices due to stronger demand for raw materials. Overall, total input cost inflation climbed, which prompted companies to slightly increase their output charges for the first time since February.
Moreover, purchasing activities peaked at a three-month high as businesses sought to bolster inventories in anticipation of future demand. Although there was a slight improvement in business optimism, it remained below the average level.
