The August PMI survey results indicated a shift in the expansion of the non-oil private sector in the United Arab Emirates. In addition to stronger output growth, inventory expansion, easing supply limitations, and reduced price pressures, businesses reported a significant increase in new business, the joint-strongest in almost two years.
For the second consecutive month, the seasonally adjusted S&P Global UAE Purchasing Managers’ Index (PMI), a composite indicator intended to provide an accurate overview of operating conditions in the non-oil private sector economy, increased from 52.7 in July to 55.3 in August. It was also the quickest improvement in operating circumstances since December 2024.
The strong recovery resulted from both resumed stock buildouts and increasing sales momentum. A sharp rise in new work inflows, the joint-fastest since March 2024, served as a focal point for the former. Businesses reported increased consumer activity that coincided with a gradual, if not total, easing of economic caution brought on by the Middle East crisis. After a contraction in the second quarter, export demand also rose, indicating consecutive expansions.
August saw a larger increase in output, the fastest in six months. Non-oil companies linked increased activity to ongoing project progressions, customer digital migrations, and less logistical problems in addition to increasing order book volumes.
Some businesses apparently did not have enough time to scale up operations due to the rate of growth in new orders. Additionally, anecdotal information indicated that businesses were reluctant to hire workers because of persistent uncertainty surrounding the regional conflict and its macroeconomic effects, resulting in a decline in employment levels for the second time in three months.
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