Saudi non-oil private-sector growth eases in January as cost pressures build – PMI

Riyadh, February 3, 2026 (Saudi Arabia Breaking News) – Saudi Arabia’s non-oil private sector continued to expand in January, but at a slower pace than the previous month, as rising input costs added pressure despite firm demand, a purchasing managers’ survey showed.

The seasonally adjusted Riyad Bank Saudi Arabia Purchasing Managers’ Index fell to 56.3 in January from 57.4 in December, its lowest level in six months, while remaining firmly in expansion territory. A reading above 50 indicates growth.

Business activity was supported by strong market demand, new projects and stronger client activity, while overall new order growth was described as close to flat.

The New Orders sub-index rose to 61.9 from 61.8 in December, with volumes supported by positive domestic conditions and higher export sales, particularly to Gulf and Asian markets, the survey showed, while noting foreign competition as a constraint on gaining international clients.

Riyad Bank chief economist Naif Al-Ghaith pointed to continued strength in output and sales supported by newly approved projects, steady customer enquiries and improved investor activity, even as growth momentum moderated.

Employment growth softened to its slowest pace in a year, despite continued hiring, with firms reporting demand for technical skills.

Cost pressures intensified for a second consecutive month, with higher prices reported for key inputs including metals and fuel, alongside increased wages.

Saudi Arabia’s economy grew 4.5% in 2025, according to flash government estimates, and close to 5% in the fourth quarter, supported by non-oil activity. Firms remained optimistic in January about future output, supported by rising orders and resilient economic conditions.