Dubai – Mubasher: The UAE’s non-oil private sector enjoyed further gains in March, a trend seen across the first quarter of 2017, according to a new report.
“The overall expansion was driven by sharper increases in output and new orders, as well as a record rise in stocks of purchases,” the Emirates NBD UAE Purchasing Managers Index (PMI) showed.
Non-oil private companies raised their payroll figures slightly despite an “evidence of ongoing pressure on operating capacity”, while market competition was “intense” as a large number of these companies recorded no change in output charges, despite a rise in cost pressures.
“The latest PMI survey for the UAE points to encouraging growth in the non-oil economy through the first quarter of 2017. What was particularly notable in this report was the degree of optimism among local firms about the potential for further improvements in client demand, which was evident in a strong rise in purchasing activity,” said Tim Fox, head of research and chief economist at Emirates NBD.
The Emirates NBD UAE PMI is a composite indicator designed to give an accurate overview of operating conditions in the UAE’s non-oil private sector economy.
The headline seasonally adjusted Emirates NBD UAE PMI witnessed a 19-month high of 56.2 in March, from 56.0 in February. “The reading was consistent with a sharp improvement in business conditions. As a result, the quarterly average for the first quarter of 2017 (55.8) was the strongest in one-and-a-half years”, according to the report sponsored by Emirates NBD and produced by IHS Markit.
Gains in the headline index were backed by stronger growth in business activity, with the rate of expansion accelerating “to the sharpest in 25 months”.
Another general indicator of improvement in economic conditions and market demand is the number of new projects which was seen and reported as behind output growth.
Similarly, growth in new order book volumes grew to a 19-month high and was sharp overall. “According to anecdotal evidence, more construction activity, good quality products, and promotional activities were behind the rise in new orders. New export business also expanded in March,” the report said.
