Dubai's non-oil economic growth slows in December

Latest Emirates NBD data shows that new business increased at the second-slowest rate in over two years
Dubai's non-oil economic growth slows in December
By Bernd Debusmann Jr
Wed 16 Jan 2019 02:00 PM

Non-oil private sector private sector growth in Dubai eased in December, even as it continued to rise at a strong overall pace, according to new data from the Emirates NBD Dubai Economy Tracker Index.

Despite the growth, the statistics show that new business increased at the second-slowest rate in more than two years, with inflationary pressures remaining weak as input costs rose modesty and firms continued to cut their charges.

All three of the sectors monitored in the report – construction, wholesale and retail and travel and tourism – registered slower improvements in business conditions over the course of the month.

Of these sectors, travel and tourism posted the weakest overall growth, followed by construction and wholesale and retail.

According to Emirates NBD, total non-oil sector output rose for the 34th consecutive month in December, although the rate of growth eased to the third weakest of 2018.

Although output rose significantly, employment remained relatively stable following fractional increases in staffing levels in November and declines in September and October. In the construction and travel and tourism sectors, jobs contracted in December.

Additionally, inflows of new business were found to have risen in December, albeit at a slower pace. With the exception of October, growth was at the lowest point since October 2016. Rates of expansion in all three sectors slowed, particularly in construction.

The 12-month outlook for business activity was also found to have dipped to a five-month low in December.

Average input prices in the non-oil private sectors were found to have risen only modesty in December, with the rate of inflation at a four-month low.

At the sector level, there was a relatively strong increase in travel and tourism, which stood in contrast to a fall in input costs in the wholesale and retail sector.

Because of subdued costs, private sector companies cut their charges for goods and services for an eighth consecutive month in December.

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