Dubai's non-oil private sector sees fastest rise in activity for three years in July
The latest S&P Global Dubai Purchasing Managers' Index (PMI) showed that the non-energy private sector of Dubai continued to expand sharply in July. The Dubai PMI rose to 56.4 in July. This signalled a sharper overall improvement in business conditions in the non-energy private sector economy and the best performance since June 2019. Growth has strengthened five times in the past six months, and the PMI remained above its long-run average of 54.5 in the latest period. The latest survey also signalled an easing of cost inflationary pressures after June had seen the fastest rise in input prices in nearly four-and-a-half years.
Output among non-energy private sector firms in Dubai rose for the twentieth month in succession in July, and at the fastest rate in three years. Growth rates accelerated since June across each of the three key sectors monitored, with the strongest expansion seen in wholesale & retail, travel & tourism and construction, respectively. Companies remained optimistic regarding growth of business activity over the next 12 months in July.
Input cost inflation across Dubai's non-energy private sector economy eased in July, breaking a four-month sequence of accelerating price increases. That said, cost pressures remained strong overall and the second-highest in four-and-a-half years. Among the three monitored sectors, travel & tourism recorded the fastest rate of input price inflation. Moreover, it hit a new series record (since 2015), reflecting the sector's relatively high exposure to rising fuel prices.
Non-energy private sector firms reported a stable trend in prices charged for goods and services in July, ending a 12-month period of falling output prices. Travel & tourism firms reported the fastest rise in prices charged since March 2017.
In terms of supply chains, July data signalled longer average lead times for non-energy private sector firms. This marked the first deterioration in vendor performance since December 2021, and contributed to a renewed decline in input stocks.
The headline S&P Global Dubai PMI is derived from individual diffusion indices which measure changes in output, new orders, employment, suppliers’ delivery times and stocks of purchased goods. The survey covers the Dubai non-oil private sector economy, with additional sector data published for travel & tourism, wholesale & retail and construction.