UAE - Mubasher: The UAE’s seasonally adjusted Purchasing Managers' Index (PMI) inched down to 54.2 in December 2022 from 54.4 last November, marking a slight loss of growth in non-oil businesses.
The reading highlighted a strong improvement in the non-oil sector, even if it was the softest since January 2022 when it reached 54.1, the latest S&P Global PMI data showed.
The light growth was driven by a surge in output and new business, which signalled the slowest rates since September 2021.
Although the output continued to rise at a sharp pace during December, it underlined further signs of softening from its over three-year high in August.
Meanwhile, new business at non-oil firms maintained its hike, yet, the pace of growth slowed to a 15-month low.
Demand from domestic clients improved last month. However, dwindling global economic conditions affected the expansion, as new export business decreased for the first time since August 2021.
The rise in input purchasing retreated at the end of 2022, slipping to the weakest since July.
David Owen, Economist at S&P Global Market Intelligence, said: "The UAE PMI fell for the second month in a row to 54.2 in December, almost registering the lowest reading in 2022 (54.1 in January 2022) and providing further signs that growth momentum has moderated from its post-pandemic peak in the third quarter (Q3).”
“The slowdown reflected downward movements in three of the PMI's largest components, with output and new business growth both easing to 15-month lows, whilst employment rose at the softest rate in eight months,” Owen added.
He noted: "Businesses were less confident that output growth would be sustained in 2023, as year-ahead expectations fell to the weakest level since February 2021 amid concerns that economic problems abroad will seep through into the domestic economy.”
“On the positive side, firms enjoyed a renewed fall in their expenses as commodity prices moderated and input availability improved, which supported an additional cut to selling prices,” the economist elaborated.
