Saudi Non-Oil Sector Keeps Growing in July

Saudi Arabia's non-oil private sector remained in expansion during July 2026, signalling continued momentum outside the oil economy. The Purchasing Managers' Index (PMI) stood at 53.1 in July, slightly down from 53.3 in June but still comfortably above the 50 mark that separates growth from contraction.

The July performance was largely supported by rising new order volumes and firm domestic demand, even as export demand declined during the month. Non-oil private sector firms also continued to add jobs, though the pace of hiring was slower than the levels recorded in early 2026.

The figures build on official data showing non-oil activities grew 2.9% year on year in the first quarter of 2026. In the second quarter, non-oil activities expanded 0.6% year on year, even as overall real GDP declined due to lower oil activity — underscoring the growing role of the non-oil economy.

Costs and confidence

On the cost side, input price inflation eased to a four-month low in July, offering some relief to businesses, although it remained elevated compared with historical norms. Forward-looking sentiment softened, with only 8% of non-oil private sector firms expecting output growth over the coming year.

For residents, expats and business owners across Riyadh, Jeddah and beyond, the data points to steady activity in sectors such as retail, services and construction that shape everyday jobs and spending. The mix of continued expansion, cooling costs and more cautious confidence reflects an economy still growing while adjusting to shifting global demand.

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