Growth in the non-oil private sector dropped 2.5% according to Emirates NBD's Dubai Economy Tracker Index
Business conditions in the UAE’s non-oil private sector witnessed their slowest growth since October 2016 due to weaker momentum in wholesale, retail, travel and tourism industries, according to figures by Emirates NBD’s Dubai Economy Tracker Index.
The indicator, which gives an overview of operating conditions in the sector, showed growth dropped 2.5% from 55.3 in March to 53.9 in April.
►Economy Tracker Index down to 53.9 in April, from 55.3 in March
►Job creation returns to the non-oil private sector
►Renewed rise in input costs
However, travel and tourism remained the strongest performer with a 55.3 score, followed by construction at 54.9 and wholesale and retail at 53.5.
A below 50.0 score indicates a declining non-oil private sector economy, while a rate above 50.0 shows one that is generally expanding. A reading of 50.0 signals no change.
“The softer Economy Tracker Index in April appears to reflect weaker inventory accumulation as well as slower output and new work growth. However, demand still appears to be relatively robust,” said Khatija Haque, head of MENA research at Emirates NBD.
While the pace of expansion in the sector fell below the average recorded, panellists reported a return to job creation for the first time since January, though the rate of employment growth was marginal.
Over the next 12 months, however, businesses expect an improvement in output levels, with overall positive sentiment reaching a three-month high in April, partly due to new project wins and an expected economic upturn.
As for input price inflation, it fractionally returned during April following a marginal fall in March, as firms noted higher wages and raw material costs. Businesses also raised their output charges, reflecting the increase in input costs.
The next Dubai Economy Tracker Report will be published on June 8, 2018.