United Arab Emirates: PMI dips to a series record-low in September
October 3, 2019
The IHS Markit Purchasing Managers’ Index (PMI) ticked down to 51.1 in September from 51.6 in August. However, the index remained above the 50-threshold that separates expansion from contraction in the non-oil producing private sector.
September’s dip was mainly due to the softest rise in new orders since current records began a decade ago, due to weaker gains in both domestic and foreign new orders; conversely, output increased at a faster pace than in August, but remained modest nonetheless. On the price front, input prices rose marginally, while output prices continued to tick down driven by increased competition.
Looking ahead, the non-oil private sector will likely pick up some pace, as solid fundamentals, a dovish stance taken by major central banks and the highly anticipated Expo 2020 will continue to underpin activity and investment in the non-oil private sector. That said, regional tensions and heightened global economic uncertainty poses a downside risk to the outlook.
Author: Steven Burke, Economist