Today's Edition
A. SREENIVASA REDDY (ABU DHABI)
The UAE’s non-oil private sector continued to expand in April, demonstrating resilience despite disruptions around the Strait of Hormuz.
The seasonally adjusted S&P Global UAE Purchasing Managers’ Index (PMI) stood at 52.1, remaining firmly above the 50 mark that signals expansion in economic activity, although easing from 52.9 in March.
“The expansion remained solid overall, as many companies noted progress on existing projects and infrastructure developments,” the S&P Global PMI report said.
The report highlighted that growth was sustained despite a challenging geopolitical environment. While several firms reported gains from new customer acquisition and higher demand, others pointed to softer sales due to lower client spending and a decline in tourism.
Cost pressures, however, intensified during the month. “The latest rise in overall input costs was the sharpest seen since July 2024, with oil and transport most commonly cited as having increased in price,” the report said.
Supply chains remained under strain due to transport restrictions in the Strait of Hormuz, although some firms indicated that strong supplier relationships helped support quicker deliveries.
Despite these constraints, sentiment among non-oil businesses remained positive. Firms reported stronger expectations for the coming 12 months, supported by healthy sales pipelines, business opportunities and technological innovation.
“The underlying strength of the non-oil private sector, highlighted by another strong increase in output, meant that companies expect growth to continue over the next 12 months,” said David Owen, Senior Economist at S&P Global Market Intelligence.
“Sales pipelines reportedly remain strong, while construction activity and predicted gains from AI investment were also cited as drivers of optimism,” he added.
Dubai PMI
In Dubai, the PMI stood at 51.6, signalling a modest improvement in non-oil business conditions, though at a slower pace compared to previous months.
Output and new business growth softened during the month, with the pace of output expansion easing to its weakest level in almost five years. At the same time, firms faced rising cost pressures due to supply chain disruptions and softer tourism-related demand.
On a positive note, output expectations rebounded in April, as more firms expressed optimism about a recovery in demand conditions.
