UAE – Mubasher: The S&P Global Dubai Purchasing Managers' Index (PMI) signalled the lowest level for eight months in April 2024, after falling to 55.1 from 58 in March, according to the latest report.
Meanwhile, the seasonally adjusted S&P Global UAE PMI retreated to 55.3 in April from 56.9 in March 2024, remaining above the crucial 50 no-change mark and contining the positive trend seen since December 2020. On the other hand, the latest improvement in operating conditions was the weakest since August 2023.
Economics Director at S&P Global Market Intelligence, Tim Moore, said: “April data highlighted strong overall growth across the UAE non-oil private sector as buoyant domestic economic conditions helped to support long-term business expansion plans.”
Moore added: “However, the latest survey signalled a sharp slowdown in new business gains in the wake of heavy rainfall and flooding. Companies operating in Dubai recorded a particularly acute loss of sales momentum as adverse weather disruptions hit business and consumer spending.”
There was a strong upturn in business activity across the non-oil private sector during April, while new orders increased at the slowest pace since February 2023 amid heavy rainfall that reportedly disrupted business operations and affected sales.
New order growth slowed in April considerably since March 2024, with the loss of momentum often linked to the impact of heavy rainfall and floods on customer demand.
Furthermore, the overall rate of new business growth reached its slowest level in 14 months.
Moore noted: “Backlogs of work increased considerably in April, which was linked to temporary business disruptions and elevated pressure on operating capacity. Non-energy businesses are nonetheless still highly upbeat about their year ahead growth prospects. Many commented on strong sales pipelines and a swift recovery from the impact of heavy rainfall.”
Non-oil private sector companies in the UAE indicated a sustained upturn in staffing numbers, which resulted in extending the current period of job creation to two years.
Moore concluded: “Higher levels of employment were recorded in April, driven by new project starts and resilient demand conditions. Pressure on operating margins remained a challenge, as price discounting continued despite faster rises in purchasing costs and salary payments.”
Meanwhile, the performance of suppliers has improved to the least extent since December 2022, due to transportation disruptions in April.
“Optimism regarding prospects for business activity growth in the year ahead remained highly upbeat in April, despite softening to a three-month low. Survey respondents mostly noted buoyant market conditions and strong sales pipelines, as well as a swift recovery from weather-related business disruptions,” S&P Global said.
