United Arab Emirates PMI September 2016

United Arab Emirates

United Arab Emirates: PMI moderates slightly in September

October 5, 2016

The Emirates NDB Purchasing Managers’ Index (PMI) dropped to a three-month low of 54.1 in September from August’s 54.7. The index remains comfortably above the 50-threshold that separates expansion from contraction in the non-oil producing private sector.

September’s result marked a moderation from August’s reading and was broadly in line with the year-to-date average of 53.8. The reason behind September’s drop was a sharp deceleration in new order growth, which recorded its weakest result in over six years. On the contrary, the rate of growth in output and employment was broadly similar to that in August. Input costs decreased for the first time in a year and a half, and output charges also dropped. Emirates NDB commented that, “the sharp slowdown in new order growth last month appears to be due to weaker demand from external markets rather than soft domestic demand. Growth in output and purchasing activity remained strong. Overall, the PMI data points to a faster rate of expansion in the UAE’s non-oil private sector in Q3 2016, compared to Q2.”

FocusEconomics Consensus Forecast participants expect GDP to expand 2.4% in 2016, which is unchanged from 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 September 2016

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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