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Tue 9 Jul 2019 09:37 AM

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Dubai's non-oil economy grows in June

New data from Emirates NBD found that staffing levels at non-oil sector firms remained unchanged

Dubai's non-oil economy grows in June
Business expectations for the next 12 months were also found to have risen in June, with record high sales forecasts in the wholesale and leisure sector.

Dubai’s non-oil private sector grew in June despite a failure to generate higher employment, according to Emirates NBD’s monthly economy tracker. 

According to the data, the rate of growth in Dubai’s non-oil private sector accelerated for the fifth time in the first six months of 2019. While all sectors recorded increases in activity, the fastest overall expansion was seen in the travel and tourism sector. 

In contrast, employment levels in the non-oil economy remained unchanged throughout the month, with many companies remaining cautious regarding new hires. Staffing was found to have dipped in the tourism and recreation and construction sectors, while it rose in wholesale and retail. 

Additionally, Emirates NBD’s data indicated a marked increase in new business activity. Although the rate of expansion eased from a peak in May, it remained among the strongest seen since Emirates NBD began tracking data in data. 

Business expectations for the next 12 months were also found to have risen in June, with record high sales forecasts in the wholesale and leisure sector. 

Price pressures weakened further during July, with input price inflation slowing for a fourth month running to the weakest in a current 15-month sequence of inflation.

At the same time, the prices charged for goods and services fell for a fourteenth month running, albeit at the slowest rate since February. 

“There was little change in the June survey relative to May, but the data for Q2 2019 points to a sharp acceleration in Dubai’s economy in the second quarter of this year,” said Khatija Haque, head of MENA research at Emirates NBD. 

“However, this growth in the value of output has been on the back of continued price discounting and as a result is not translating into more jobs or higher salaries in the private sector,” Haque added. “Nevertheless, the survey data so far this year supports our view that Dubai’s GDP growth is likely to be faster this year compared with 2017 and 2018.”