UAE's non-oil business activity eases to 12-month low in January

February 03, 2023 09:11 AM +04 | By Reuters
Image source: Reuters

DUBAI (Reuters) - Growth in the United Arab Emirates' (UAE) non-oil private sector slipped to a 12-month low in January, with weaker global economic conditions weighing on sentiment towards future activity, a survey showed on Friday.

The seasonally adjusted S&P Global UAE Purchasing Managers' Index (PMI) fell to 54.1 in January, easing slightly from 54.2 in December, and the lowest since January 2022.

The output sub-index remained unchanged from December at 58.8 but indicates continued strong expansion in non-oil private sector activity.

"The results showed that the non-oil sector remains in good health and in particular compares positively against a global economic slowdown towards the end of 2022," said David Owen, senior economist at S&P Global Market Intelligence.

"That said, weak global conditions weighed on export demand in January, as firms saw foreign sales decrease at the fastest rate since June 2021," Owen added.

New orders increased over the previous month, hitting a three-month high, with the sub-index rising to 56.0 from 55.5 in December.

However, growth in new export orders continued to weaken, with the index under the 50.0 neutral threshold for the second consecutive month, at 47.5, its lowest level since June 2021, from 49.0 in December.

Job creation accelerated from the previous month with the employment index at 51.3 in January from 50.6 at the end of 2022.

Lower transport and energy prices, and strong supply chains helped to keep input prices broadly stable in January, the survey said, while staff costs remained unchanged.

However, only 9% of respondents to the survey forecast growth over the coming year as optimism over future output prospects remained weak.

(Reporting by Rachna Uppal; Editing by Toby Chopra)

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