UAE demand growth weakens to record low in September: PMI

The rate was the slowest recorded since records began 10 years ago. (File photo: Shutterstock)

The UAE non-oil private sector continued to see a slower pace of expansion in September, according to the IHS Markit UAE Purchasing Managers’ Index (PMI) for September.

The indicator gives an overview of operating conditions in the non-oil private sector economy, and fell to 51.1 in September, down from 51.6 in August. A figure above 50 indicates expansion, while a figure below indicates contraction.

“The UAE non-oil economy continued to lose steam at the end of the third quarter of 2019. After comparatively strong demand growth earlier this year, September data signaled the weakest monthly upturn in new orders in the survey history,” said David Owen, an economist at IHS Markit.

“Companies reported further competitive pressures, while also seeing a slowdown in customer movement despite sustained price discounting,” Owen added.

The rate was the slowest recorded since records began 10 years ago. IHS Markit noted that companies had noticed slowing market conditions leading to a reduction in customer orders during the month.

Private sector output also recorded a relatively weak uplift in September. Although slightly faster than the result recorded in August, it was still the second softest in over six years.

A marginal rise in demand and increased marketing activity, however, contributed to an overall output increase.

“Businesses were more downbeat towards the one-year outlook. Sentiment eased to the lowest in seven months, but was still stronger than the series average, with the Expo 2020 remaining a key source of optimism among panelists,” said Owen.

Last Update: Wednesday, 20 May 2020 KSA 09:54 - GMT 06:54