Qatar private sector witnesses significant business activity in April: QFC

Doha’s non-energy sector, particularly construction, witnessed significant improvement in the business conditions in April this year, according to the Qatar Financial Centre (QFC).Output rose at the fastest rate since the series began in April 2017, while new orders expanded at the third-quickest rate in the series history. Activity growth was especially strong in the construction sector.That said, despite buoyant market conditions and relatively weak rates of inflation, positive sentiment dipped to a new series low in April."Record uplifts in backlogs should sustain output growth in the coming months as firms continue to work through their work in hand. Qatar's non-energy private sector once again registered a strong performance, which has particularly been the case over the last eleven months," said QFC Authority chief executive Yousuf Mohamed al-Jaida.The Qatar PMI indices are compiled from survey responses from a panel of around 450 private sector companies. 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 increased to a new record high of 63.6 in April, up from 61.8 in March. This indicated the strongest overall improvement in non-energy sector business conditions since the survey began just over five-years ago.Central to the upsurge was a record uplift in output, which has now expanded over the last 22 months. All four monitored sectors recorded substantial rates of output growth in April with construction leading the uptick. Manufacturing, services and wholesale and retail followed behind, respectively.These strong demand conditions added to capacity pressures at the start of the second quarter with incomplete work rising for the nineteenth month in succession, the QFC said, adding backlogs rose at a survey-record rate with firms in the manufacturing and service sector recording sharp increases in work-in hand.Despite rising backlogs, employment levels rose only marginally, and at the softest pace in three months, it said, adding firms remained optimistic about output growth over the next 12 months.Price pressures continued to build at the start of the quarter, with average input costs rising for the ninth month in succession. However, firms held back on passing on higher expenses and instead chose to reduce their selling prices. Promotional activity and discounting have now been seen in each of the last three months.The QFC’s latest PMI survey data on Qatar's financial services sector also signalled a record improvement in output, underpinned by robust demand conditions.On financial sector, the QFC said financial services companies remained optimistic regarding growth prospects over the next 12 months, though the degree of positivity dipped to a nine-month low.In response to strong demand for financial services, companies in the sector boosted workforces at the start of the second quarter. The rate of increase was broadly in line with that seen in March and quicker than the long-run series average.