United Arab Emirates PMI August 2016

United Arab Emirates

United Arab Emirates: PMI moderates slightly in August after peaking in July

September 5, 2016

The Emirates NDB Purchasing Managers’ Index (PMI) dropped to 54.7 in August from July’s ten-month high of 55.3. The index remains comfortably above the 50-threshold that separates expansion from contraction in the non-oil producing private sector.

August’s result marked a moderation from July’s reading but was still above the 12-month average of 54.5. The reason behind August’s drop was the normalization in economic activity after July’s peak. While output, new work and employment continued to rise robustly and pointed to solid business conditions, their expansion was slower than in July. Input costs rose in August, although the intensity of competition limited the impact on the final products. Emirates NDB commented that, “output and employment appeared to be the main reasons for the slower rate of expansion last month, coming off the highs posted in July. However, output continues to expand at a relatively fast pace and new order growth is also robust.”

FocusEconomics Consensus Forecast participants expect GDP to expand 2.4% in 2016, which is unchanged over last month’s projection. For 2017, the panel sees the economy increasing 2.8%.

Author:, Economist

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United Arab Emirates PMI Chart

UAE PMI August 2016 0

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

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