Qatar’s non energy private sector showed signs of stabilisation in June, with firms reporting a return to normal operations and recovering demand.
The S&P Global Purchasing Managers’ Index (PMI) rose to 47.6 in June from 45.9 in May, its highest in four months, signalling that the pace of decline in business conditions has slowed.
Non energy output was broadly stable, ending a six month downturn, as companies cited recovering demand and stronger capacity. Construction activity rebounded during the month, helping to offset weakness in services.
New orders continued to contract, though at a slower pace than earlier in the year. Firms pointed to business uncertainty, increased competition, and sectoral challenges in real estate and tourism. Wholesale and retail operators, however, reported gains in new work.
Trevor Balchin, Economics director at S&P Global Market Intelligence, stated: “The PMI rose to a four month high in June and the outlook for the next 12 months improved notably, hinting that the non energy private sector was on the cusp of a recovery approaching the midway point of 2026.”
“The June data collection period began on June 11, prior to the signing of an initial peace agreement between the US and Iran on June 17, and closed on June 23,” Balchin also said.
Employment growth extended its 23 month sequence, though gains were modest. Workforce numbers rose in manufacturing and retail but declined in construction and services. Input purchases also increased for the first time in six months, allowing firms to replenish inventories, Balchin explained.
Inflationary pressures remained a concern, Balchin noted. Input costs accelerated for the sixth consecutive month to a 20 month high, driven by steeper wage growth, while output charges rose at the fastest pace since December 2022. He noted that purchase price inflation eased slightly compared to May, suggesting raw material costs may have peaked.
Despite these pressures, sentiment strengthened across all monitored sectors, according to S&P Global. The Future Output Index climbed to a four month high, with businesses anticipating improved market conditions once regional tensions stabilise.
