UAE's Non-Oil Sector Continues to Grow

UAE's Non-Oil Sector Continues to Grow

UAE's Non-Oil Private Sector Continues Growth in March

A survey released Friday showed that the UAE's non-oil private sector continued to grow in March, albeit at a slightly slower pace than in February. The seasonally adjusted S&P Global UAE Purchasing Managers' Index (PMI) registered 54.0 last month, down from 55.0 in February.

A reading above 50 indicates expansion in economic activity, while a reading below 50 indicates contraction. The UAE PMI has remained above 50 since late 2020, achieving continuous growth.

New orders also grew for the third consecutive month, with the New Orders Index falling to 56.3 in March from 57.3 the previous month. "Some companies may face challenges meeting their sales targets," said David Owen, chief economist at S&P Global Market Intelligence.

Despite the slowdown in growth, companies ramped up their purchases of production inputs at the fastest pace since July 2019 to meet backlogs. Employment growth was at its weakest in nearly three years as companies struggled to find suitable candidates. Input prices rose moderately, with some firms citing higher material costs while others benefited from lower transportation costs.

Dubai's non-oil private sector also grew in March, but at a slower pace. The headline Purchasing Managers' Index (PMI) fell to a five-month low of 53.2, down from 54.3 in February. New orders rose sharply but also at a slower pace, leading to a rare decline in employment. UAE businesses remained optimistic about future growth, supported by strong programs and the development of national infrastructure.