A survey showed today, Monday, that the non-oil private sector in the UAE grew in August at the fastest pace since June 2019, supported by improved demand and lower selling prices, despite the decline in sentiment about the future to its lowest level in 17 months.
The seasonally adjusted Standard & Poor's Global Purchasing Managers' Index (PMI) in the UAE rose to 56.7 in August from 55.4 in July, jumping to its highest level in 38 months, surpassing the chain's average since 2009 of 54.2, Reuters reported.
David Owen, an economist at Standard & Poor's Global, said the headline figure indicated a strong improvement in conditions in the non-oil economy.
He added that input costs decreased significantly for the first time since January 2021 after lower fuel prices helped ease the burden on companies' expenses and encouraged lower prices for other components.
The renewed decline marked a significant turnaround in inflationary pressures, which reached an 11-year high in June.
The data gives hope to other countries struggling with persistent inflation despite persistent fears that continued global energy supply constraints will push up prices.
The production sub-index rose to 64.5 in August from 62.5 in July, also its highest level since June 2019. The series average is 57.6.
The sub-employment index rose to 51.5 from 51.0 in July, the fourth consecutive month of expansion and its fastest pace in a year. The index was just above the series average of 51.3.
The survey indicated that wherever more employees were registered, respondents attributed this to new projects, increased demand, and hiring management personnel.
Owen said that despite the positive numbers, sentiment about future production over the next 12 months fell to its lowest level since March 2021, amid warning signs that the global economy may enter a recession by the end of the year.
Only 10 percent of companies surveyed expected to see an expansion in activity next year, although only 1 percent expected a contraction.
