Qatar non-energy private sector sees buoyant business; profitability improves: QFC PMI

Doha's non-energy private sector kept experiencing improved business conditions at the start of the final quarter of 2023 and the 12-month outlook remained “upbeat”, according to the Qatar Financial Centre (QFC).
Output, new orders and employment expanded in October, and profitability improved as firms hiked prices for goods and services at the fastest rate since February; while average input prices fell for the first time in the year so far, according to the QFC's latest purchasing managers' index (PMI).
"Business conditions in Qatar's non-energy private sector economy continued to improve moving into the final quarter of 2023, albeit at a slightly reduced tempo," QFC Authority chief executive officer Yousuf Mohamed al-Jaida said.
The Qatar PMI indices are compiled from survey responses from a panel of around 450 private sector firms. The panel covers the manufacturing, construction, wholesale, retail, and services sectors, and reflects the structure of the non-energy economy according to official national accounts data.
The PMI posted 50.8 in October, from 53.7 in September, but the overall growth has been maintained since February, although the headline figure dipped below its long-run average (52.3, since 2017) in the latest period.
Business activity among Qatari non-energy private sector firms rose further in October, with firms often reporting higher customer numbers.
Output has risen every month since July 2020, except for a brief correction in January following the conclusion of the FIFA World Cup Qatar 2022. The overall rate of expansion was the softest in 2023 so far, but construction continued to post a solid rebound in activity.
New business increased for the ninth successive month in October, with strong demand at wholesalers and retailers in particular. The overall rate of growth eased since September, however.
Non-oil private sector employment expanded for the eighth month running in October, driven by construction firms and manufacturers, who also held the strongest 12-month outlooks for activity in October.
Supply chains continued to improve in October, as lead times for inputs shortened for the 18th consecutive month. Purchasing of inputs rose for the eighth straight month, but only fractionally, as firms aimed to stabilise their inventory levels. Input stocks were unchanged since September.
The survey found wages and salaries were only fractionally up since the previous month.
Qatari financial services companies saw another marked increase in total business activity in October. The seasonally adjusted financial services business activity index posted 58.3, well above the overall private sector figure of 51.4 and a slight improvement on September.
Demand was still strong overall and more robust than the non-energy sector average. Meanwhile, employment at financial services firms rose for the seventh month running, it said.
"Data on financial services suggested the sector continued to outperform the wider economy in October," al-Jaida said.