UAE: Non-oil private-sector conditions improve at milder rate in July

UAE PMI July 2023

UAE: Non-oil private-sector conditions improve at milder rate in July

The S&P Global Purchasing Managers’ Index (PMI) fell to 56.0 in July, down from June’s multi-year high of 56.9. Despite the downtick, the index remained comfortably above the 50.0 no-change threshold, signaling a continuous improvement in non-oil private sector operating conditions from the prior month.

July’s moderation largely reflected a softer expansion in output and new orders, reflecting higher competition dampening domestic sales, while exports were largely unchanged. Nevertheless, improving market conditions and strong consumer demand sustained another robust increase in both production and new business which prompted firms to onboard more staff. Despite higher employment, backlogs rose at the steepest rate in over three years.

Turning to prices, input cost inflation eased to a three-month low amid lesser salary pressures, plus lower commodity prices and freight costs. As a result, selling charges were reduced once again amid ongoing promotions and discounts. Lastly, firms’ sentiment regarding output expectations for the coming 12 months was the second-strongest in just over a year.

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