Business activity in Dubai’s non-oil private sector economy increased at a softer rate in August on the back of a slowdown in the pace of new orders.
Although the employment fell marginally in July and the business outlook slipped, the output prices in the emirate were broadly unchanged, according to a new survey.
The seasonally adjusted IHS Markit Dubai Purchasing Managers’ Index, which reflects the performance of the non-oil economy of the emirate, fell to 51.7 in August from 55.2 in July, its lowest reading since February 2016. Overall, the increase pointed to only a modest uplift in non-oil private sector operating conditions.
“Demand growth was notably softer, leading firms to raise activity at a below-average pace and reduce workforce numbers slightly,” David Owen, an economist at IHS Markit, said. “Future output expectations dimmed but remained relatively strong. With the Expo 2020 coming next year, firms were still optimistic that activity will expand.
Positivity was seen on the price front, as selling prices were close to stabilisation during August after 15 consecutive months of discounting, he noted.
The slowdown was mostly reflected in the wholesale & retail and construction sectors, with the latter posting the weakest improvement in business conditions for three-and-a-half years. The travel & tourism sector also saw an easing in growth, albeit only marginally, according to the survey.