October’s data signaled another weak month for business conditions in UAE’s non-oil private sector economy, according to an IHS Markit survey released on Tuesday.
The growth of new businesses dropped to a record low, and a decline in foreign sales added to firms’ concerns at the beginning of the fourth quarter, IHS Markit said.
Output grew at a relatively subdued pace, with businesses restraining from purchases.
The seasonally adjusted IHS Markit Purchasing Managers’ Index (PMI), which covers manufacturing and services, was unchanged at 51.1 in October, remaining at its lowest level since May 2010.
PMI readings vary between 0 and 100, with a reading above 50 indicating an increase compared to the previous month, and below 50 an overall decrease.
“UAE companies continued to ease back from the recent growth momentum earlier this year, with activity levels rising at the weakest rate since 2012,” IHS Markit Economics David Owen said.
Despite the tough market conditions, expectations towards future output improved in October.
Firms expect new strategies and greater investment ahead of the Expo 2020 to result in higher levels of activity, according to IHS Markit.
However, the degree of optimism remained weaker than the average for 2019, it added.