Jadwa Investment’s recently released May 2015 Chartbook found a decline in Saudi Arabian government reserves for a 6th straight month and overall healthy consumer consumption data.
In March, net government accounts with SAMA fell by a total of $9.5 billion (SR 35.7 billion), continuing a negative monthly change for the sixth consecutive month, the Riyadh-based investment firm said. The government’s “elevated spending” also puts pressure on foreign reserves, which fell by $16 billion to reach $694 billion in March, Jadwa said.
Graphic via Jadwa Investment.
“The year-to -date net change to government accounts was -$45.5 billion (21.6 percent of budgeted spending for 2015).”
Over 90 percent of foreign revenue comes from oil, according to Bloomberg. A 48 percent drop in oil prices last year has caused stress on these reserves, causing the 6-month decline as noted by Jadwa.
However, consumer consumption data pointed to a healthy economy despite a slight dip in March. “Key consumption indicator data softened slightly in March, but remained at levels consistent with robust annual growth. PMI rose in
Graphic via Jadwa Investment.
March to its highest point in six months pointing to a healthy expansion in the non-oil sector. Cement production and sales continued to record strong growth in March,” Jadwa Investment said.
[Click here to read the full report from Riyadh-based Jadwa Investment] [Arabic]
