United Arab Emirates PMI

United Arab Emirates

United Arab Emirates: PMI inches up in December

January 6, 2015

The HSBC Purchasing Managers’ Index (PMI) inched up from 58.3 in November to 58.4 in December. As a result, the PMI remains firmly entrenched above the 50-threshold that separates expansion from contraction in the non-oil producing private sector.

December’s figure mainly reflected a faster pace of expansion in production, which rose to the second highest rate in the series to date, and a sizeable increase in new orders. This situation prompted businesses to increase their staffing levels. In turn, inflationary pressures rose in December mainly due to higher wage growth and increases in purchasing costs. HSBC analysts added that, “[w]e expect lower oil prices to weigh on the economy into 2015, but for now demand is holding up well. That now orders as well as output have remained strong is particularly encouraging.”

FocusEconomics Consensus Forecast participants expect GDP to expand 4.1% in 2015, which is down 0.1 percentage points over last month’s projection. For 2016, the panel sees the economy also increasing 4.1%.

Author: Ricard Torné, Lead Economist

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United Arab Emirates PMI Chart

UAE PMI December 2014 0

Note: HSBC Non-oil Purchasing Managers’ Index. Readings above 50 indicate an improvement in business conditions while readings below 50 indicate a deterioration.
Source: HSBC and Markit.

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