A survey of businesses reported that the non-oil private sector in the UAE recorded significant improvements in business conditions in October, but at a lower rate compared to the improvement observed in the previous month.
The growth momentum was higher than the mid-year growth, driven by a robust increase in new orders, but the job additions were at a sluggish pace.
Therefore, the seasonally managed S&P Global UAE Purchasing Managers Index (PMI), a composite measure of operating conditions in the non-oil private sector, dropped in October to 53.8, compared to 54.2 in September.
S&P Global Market Intelligence’s Senior Economist David Owen stated that “The pace of new business growth has recovered well since its low in August, supporting increases in output and purchasing activity.”
The October output increased significantly due to improved sales and the introduction of new projects. Although the growth rate remained higher than the average in the middle of the year.
Another advantage that companies experienced is the slow growth in the cost of inputs over the second consecutive month and which contributed to relative stability in output prices.
Nevertheless, expectations about further activity decreased, and the growth of hiring was almost at zero. The October figures showed the least growth in the number of jobs in seven months, with marginal growth.
Owen added that “This partly reflected a relatively subdued level of business confidence. In fact, the latest survey revealed that firms were the least optimistic in nearly three years.”
The PMI of Dubai has increased to its highest point since January, the index rose marginally to 54.5 in October, compared to 54.2 in September, due to an increase in new orders and level of output.
The seventh month of rising employment was reported, but the growth rate was comparatively lower.
