UAE: PMI increases to two-year high in July
The IHS Markit Purchasing Managers’ Index (PMI) climbed to a two-year high of 54.0 in July, up from June’s four-month low of 52.2. As such, the index moved further above the 50-threshold, signaling a faster improvement in business conditions in the non-oil private sector compared to the previous month.
July’s upturn was largely due to output growing at a faster rate than the previous month, while new orders also rose sharply chiefly owing to recovering demand as Covid-19 restrictions were further eased. However, lingering measures abroad prompted export sales to drop for a third consecutive month in July and markedly delayed input deliveries. Meanwhile, employment levels increased again, with the job creation rate hitting an over two-year high. On the price front, raw material shortages continued to drive input prices up, which were partly passed on to customers. Lastly, business expectations declined in July, although firms remained positive amid expectations of a further lifting of restrictions and the upcoming Expo 2020 in October.