United Arab Emirates Economic Outlook
March 6, 2018The strong tailwinds that were in place in 2017 are keeping the non-oil economy sailing smoothly in the early months of 2018, despite a slowdown following the introduction of a 5% VAT in January. The non-oil PMI receded to a five-month low in February on lower output growth but remains in expansion territory, buttressed by strong domestic demand. Moreover, despite the constraints imposed by the OPEC agreement to cut oil production, the hydrocarbon sector is benefiting from higher oil prices compared to last year. Looking ahead, stronger oil revenues are poised to support government spending this year. Notably, a large increase in infrastructure spending is expected, especially in Dubai, which hosts the 2020 World Expo and is already benefitting from a boom in construction.
United Arab Emirates Economic GrowthStrong public sector support should drive a sharp increase in growth in the non-oil economy this year, while household consumption remains constrained following the implementation of VAT. Public spending should furthermore be reinforced by higher oil prices amid healthy global growth. Finally, tourism growth will likely remain robust, particularly in Dubai as the city prepares for the 2020 World Expo. However, downside risks related to regional instability remain, notably the ongoing feud with Qatar, as well as risks of volatility in oil prices. FocusEconomics panelists expect GDP to increase 2.8% in 2018, which is unchanged from last month’s forecast, and 3.3% in 2019.
United Arab Emirates Economy Data
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United Arab Emirates Facts
|Exchange Rate||3.67||0.0 %||Mar 15|
|Stock Market||0.4||0.75 %||Mar 15|
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United Arab Emirates Economic News
March 5, 2018
The Emirates NDB Purchasing Managers’ Index (PMI) fell from January’s 56.8 to 55.1 in February.
United Arab Emirates: Inflation shoots up to nearly three-year high in January following the introduction of VAT
March 5, 2018
Consumer prices rose 2.67% in January from the prior month, a large increase from December’s 0.68% month-on-month upswing.
February 5, 2018
The Emirates NDB Purchasing Managers’ Index (PMI) dipped from December’s multi-year high of 57.7 to 56.8 in January.
January 23, 2018
Consumer prices rose 0.69% in December from the prior month, contrasting November’s 0.03% decline.
January 4, 2018
The Emirates NDB Purchasing Managers’ Index (PMI) increased from 57.0 in November to 57.7 in December.