Prime Highlights
- Saudi POS expenditure reached more than SR12.19 billion for the fourth consecutive week.
- Hotel expenditure rose 2.1%, offsetting wider sector losses.
Key Fact
- POS weekly transaction fell to 212.73 million, down from a 4.8% drop.
- The leader was Riyadh at SR4.20 billion, followed by Jeddah and Dammam.
Key Background
The consumer economy of Saudi Arabia remains robust with point-of-sale (POS) transaction still above the SR12 billion level in fourth consecutive week, at SR12.19 billion. The performance is in addition to the 7.1% week-on-week drop, indicating that the consumer interest is steady in the very back bone of the economy.
Among the standouts was the hotel industry, which registered 2.1% increase in expenditure, amounting to SR287.44 million. While the sector’s transactions number was slightly down, the value increase is a reflection of moving to longer lengths or more expensive bookings, which could be due to domestic tourism and business travel. The growth of the hospitality sector itself is a sign of a long-term post-pandemic renaissance and the Kingdom’s attempts to encourage local travel and tourism.
Conversely, some major retailing categories fell sharply. Apparel and footwear fell 13%, communications fell 12.5%, and restaurants and cafes fell 6.9%. Food and beverage expenditure also fell 6.6%. All these falls may indicate a rebalancing of consumer interests due to possibly seasonally related effects, inflation pressures, or back-to-school expenditures diverting outlay. Miscellaneous goods and services fell 9.9%, which shows a prudent consumption approach.
In geographical terms, Riyadh was at the top of transactions value at SR4.20 billion, followed by Jeddah at SR1.76 billion and Dammam at SR582.99 million. While these three cities registered contractions of 6% to 7.2%, their sustained leadership is a testament to their economic importance. Secondary cities like Abha and Makkah registered lower contractions, reflecting relative stability in regional consumer consumption.
This is in spite of week-to-week volatility since the consistent high level of POS transactions across the economy indicates deeper stability in the economy. The consistent performance by the hospitality sector and regional stability underpin consumer confidence in the core sectors of Saudi Arabia’s expanding and diversifying economy.
