United Arab Emirates: PMI climbs again in February
March 5, 2017
The Emirates NDB Purchasing Managers’ Index (PMI) rose from 55.3 in January to 56.0 in February, the highest figure in one and a half years. The index has now been increasing uninterruptedly since November last year and remains comfortably above the 50-point threshold that separates expansion from contraction in the non-oil producing private sector.
February’s increase was driven by growth in output and new work amid an environment of strong domestic and external demand. In response to healthy operating conditions, businesses hired extra workers and ramped up purchasing activity, with a resulting increase in stock levels. Input prices rose moderately over the month and at a slower pace than in January. Despite this, firms raised output prices for the first time in over a year in a bid to boost profit margins. According to Khatija Haque, Head of MENA Research at Emirates NBD, “higher oil prices have likely contributed to improved sentiment and business activity over the last few months.”
Author: Oliver Reynolds, Economist