UAE starts Q2 on strong footing as new businesses post 17-month high growth

UAE starts Q2 on strong footing as new businesses post 17-month high growth

Customer demand is strongest since September 2020

Shoppers at a store in Dubai. In the UAE, the relatively mild uptick in business expenses encouraged a number of companies to offer price promotions. - KT file

Published: Wed 3 May 2023, 5:22 PM

Driven by the fastest growth in new business since November 2021, business conditions at private non-hydrocarbon sectors in the UAE improved at a sharp and accelerated rate in April, starting the second quarter on a strong footing.

The latest purchasing manager index survey data shows that businesses responded to the improving conditions by increasing output sharply and adding to both their inventories and staffing levels. A solid drop in selling prices partly spurred a surge in customer demand.

David Owen, a senior economist at S&P Global Market Intelligence, said a rapid increase in new orders and retreating inflationary pressures led to a stronger rate of expansion across the non-oil economy resulting in the PMI’s rise for the third month running.

While customer demand, the strongest recorded since September 2020, was helped by receding cost pressures, the S&P Global UAE PMI rose further from 55.9 in March to 56.6 in April, signalling a robust improvement in the performance of the non-oil economy.

The Central Bank of