We are pleased to announce our April 2018 edition of the MEFIC Macroeconomic Monthly. In this edition, we highlight the key takeaways from quarterly earnings performance of TASI stocks as well as trends in select macroeconomic indicators as follows.
• Q4 2017 results of TASI stocks showed an overall tepid performance with aggregate earnings falling 1.3% YoY and 53.5% QoQ. However, strong earnings were registered by top 3 heavyweight sectors i.e. Materials, Banks and Telecom which saw YoY earnings growth of 18.1%, 31.4% and 31.2% respectively.
• The banking sector was the biggest contributor to Q4 2017 earnings amongst Tadawul sectors, with 31.4% YoY jump in net profits helped by lower base of Q4 2016 as well as higher NIMs, lower operating expenses and comparatively lower provisioning.
• KSA slightly decreased oil production, producing 9.87 million barrels of oil per day (mbpd) in March 2018, to keep below the production limit.
• Inflation rate during February 2018 rose 3.0% YoY and 0.1% MoM.
• Saudi Arabia’s PMI fell to record low of 52.8 in March 2018, from 53.2 in the previous month , with incoming new businesses growing at the slowest rate on record.
• Bank credit continued to decline for the 12th consecutive month, as it decreased 0.6% YoY in February 2018.
• POS transactions grew 8.7% YoY to SAR 15.4bn in February 2018, declining 6.4% MoM from SAR 16.4bn in January 2018.
• On March 15, SAMA raised its repo and reverse repo rates by 25bps each, to 2.25% and 1.75% respectively, ahead of the anticipated US Fed rate hike. While the reverse repo rate was being raised over the past two years in line with the Fed rate changes, this was the first time since 2009 that Saudi Arabia has changed the repo rate.
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Monthly Macroeconomic Report-April2018