Kuwait Purchasing Managers' Index Rises for the First Time
Kuwait’s main Purchasing Managers’ Index (PMI), which measures the performance of the non-oil private sector, rose for the first time in five months in July 2026, reaching 50.8 points, up from 46.4 points in the previous month.
According to a study by S&P Global, this increase indicated a slight improvement in the performance of the non-oil private sector at the start of the second half of the year.
Although the index remained in positive territory, it stayed below the level recorded immediately before the outbreak of the war in the region in February. The study noted that Kuwait’s non-oil private sector returned to growth at the beginning of the third quarter of 2026, as the resumption of air travel supported renewed increases in production and new orders.
With rising workloads, companies expanded their purchasing activities, while employment rates stabilized. At the same time, positive future outlooks emerged for the first time since the outbreak of the war in the region. The study reported that production and new orders saw increases for the first time in five months. According to reports, competitive pricing also contributed to higher new orders, thereby boosting business activity, alongside the resumption of air travel.
Reports from companies indicated that market conditions remained difficult due to the conflict in the region, limiting growth rates. New export orders continued to decline, partly due to rising shipping costs. Although the recent decline was sharp, it was much weaker than in June and the slowest in five months. The rise in total new orders increased the need for production inputs among Kuwaiti non-oil companies.
As a result, purchasing activity returned to growth for the first time since the conflict began, and increased purchasing led to a noticeable rise in inventories. Some reports indicated that companies sought to maintain adequate stock levels to respond quickly to customer orders. Employment levels stabilized in July, ending a five-month streak of layoffs.
Some companies increased hiring in response to rising new orders, but weak recent demand made other firms hesitant to recruit additional staff. However, there were signs of pressure on production capacity, as backlogged work increased for the first time in five months. As some companies expanded their workforce, employee costs rose for the first time since February, albeit slightly. Meanwhile, purchasing prices increased at a steady pace, leading to another rise in total production input costs. Factors contributing to the increase in input prices included building materials, maintenance, marketing, rent, and transport. According to companies participating in the study, rising transport costs were a key factor in the recent increase in production prices, with product and service prices rising for the seventeenth consecutive month, but at a slower pace than in June.
In addition to supporting the return of growth in production and new orders in July, increased air travel activity also bolstered optimism about production levels over the next twelve months, for the first time since the outbreak of the war in the region. According to committee members, planned promotional activities, along with expectations of rising new orders, were among the factors driving this positive outlook.
