UAE private sector continues solid growth through August

The PMI data is consistent with the view of slower but solid economic growth in the UAE in 2016, said Khatija Haque, head of regional research at Emirates NBD. Satish Kumar / The National

Business activity growth in the UAE’s non-oil private sector slowed slightly in August, according to a corporate survey published on Monday.

The seasonally adjusted Emirates NBD UAE Purchasing Managers’ Index, covering manufacturing and services, fell to 54.7 last month from 55.3 in July. The 50-point level divides expansion from contraction.

“The slight decline in the August PMI reading is not unexpected given the strong July number. Output and employment appeared to be the main reasons for the slower rate of expansion,” said Khatija Haque, head of regional research at Emirates NBD.

“However, output continues to expand at a relatively fast pace and new order growth is also robust. The PMI data is consistent with our view of slower but solid economic growth in the UAE in 2016.”

Growth in output slowed to 61.4 from 62.1, while growth in new orders fell to 57.0 from 57.5. Employment growth dropped to 51.3.

Output prices fell outright for a tenth straight month, although the pace of deflation moderated, while input price inflation remained positive and rose to 54.7, its highest since October 2014.

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