Dubai’s business conditions saw the sharpest improvement in two years last month, spurred by a rebound in new orders and increased tourism as Expo 2020 got under way.
Growth across much of the non-oil private sector accelerated, according to IHS Markit. Its Purchasing Managers’ Index for the Middle East’s main business hub jumped to 54.5 in October from 51.5 in September, above the 50 mark that separates growth from contraction and the highest level since October 2019.
“The initial surge in sales contributed to a sharp expansion in activity, suggesting that the economy is well on the way to recovering from the pandemic,” said David Owen, an economist at IHS Markit. “Job creation was again signaled across only a small proportion of the survey panel in October. However, with tourism reviving and capacity pressures growing, this will likely improve in the coming months.”
- The recovery in tourism was one of the main contributors behind the upturn.
- Companies cited an increase in orders both locally and overseas.
- The rise in output was the sharpest since July 2019, with growth gathering pace in sectors including construction, tourism and wholesale and retail.
- The city’s employment rate was marginal as job creation was in part linked to an increase in work backlogs.
- Supply chains improved with the easing of travel restrictions.
- Price pressures were muted, with a little advance in input costs that was the joint-weakest in eight months.
- Future business confidence improved notably and overall expectations were the highest since March 2020, still weaker than pre-Covid trends.
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