Business activity expanded sharply in February, according to new statistics from Emirates NBD
Business conditions across Dubai’s non-oil private sector recorded a strong improvement in February, according to the Emirates NBD’s seasonally adjusted Dubai Economy Tracker Index.
According to the statistics, operating conditions in the non-oil private sector have improved every month for the last two years. In February, the best performing sub-sector was the wholesale and retail sector, following by travel and tourism and the construction sector.
Business activity was found to have expanded sharply, despite softening fractionally since the preceding survey.
No change, however, was reported to job creation and employment levels, ending an 11-month streak in rising payroll numbers. Job shedding was recorded in the travel, tourism and construction sectors, while growth was seen in wholesale and retail firms.
In February, inflows of new business accelerated at the fastest pace since August of 2017, with the steepest rise in the travel and tourism sector. According to Emirates NBD, many firms noted strong demand from domestic and foreign sources.
Optimism towards future growth prospects was found to be positive, despite softening from the previous month. Anecdotal evidence suggests that business confidence has been bolstered by new project wins and an expected economic upturn.
Additionally, non-oil private sector firms reported easing input cost inflation during February, even if the pace of inflation remained marked overall, particularly in the wholesale and retail sector.
Output charge inflation, however, softened in February, with the rate of inflation slight overall, despite being above the series’ long-run average.
“The PMI survey data for February continued to show solid growth in Dubai’s economy, with the travel and tourism sector performing particularly well after a relatively soft Q4 2017,” said Khatija Haque, head of MENA research at Emirates NBD.
“Overall, we expect Dubai’s economy to grow at a slightly faster rate this year, underpinned by infrastructure investment and government spending.”