Latest Emirates NBD Dubai Economy Tracker Index shows retail sector was best performing during month
Robust growth momentum of the non-oil private sector in Dubai was maintained in July, according to a new report.
The seasonally adjusted Emirates NBD Dubai Economy Tracker Index slipped slightly to 56.3 in July but remained above the long-run trend (55.2).
By sector, the wholesale & retail industry (index at 57.9) was the best performing category, followed by travel & tourism (56.3) and the construction sector (54.8).
A reading of above 50.0 indicates that the non-oil private sector economy is generally expanding.
Khatija Haque, head of MENA Research at Emirates NBD, said: “While the headline index continues to reflect strong growth in the non-oil economy in July, firms’ margins continue to be squeezed as they lower selling prices, particularly in the trade and hospitality sectors. Employment growth remains soft overall.”
The positive overall trend for business conditions was supported by a sharp increase in output, despite growth easing to a slightly slower pace. The rise in business activity was attributed by panellists to favourable economic conditions and more projects, the survey showed.
In spite of a steep expansion in business activity, the pace of job creation was only marginal, continuing the trend observed in the past five months of expansion, it added.
Notably, all three monitored sub-sectors raised their staffing levels, led by wholesale & retail.
The survey also showed that incoming new business expanded at the fastest pace since April. According to anecdotal evidence, client wins were supplemented by promotional activities and stronger underlying demand conditions.
Business confidence increased from June’s 10-month low, but remained weaker than the overall level of positive sentiment recorded on average in the series history. Optimism was firmly rooted in expectations of further improvements in demand, supported by promotional activities.