Growth of non-oil UAE businesses slows amidst severe inflation – PMI
A sharp rise in fuel prices in June resulted in a severe increase in business expenses and prompted non-oil businesses in the UAE to hire more staff as costs rose at the fastest pace in 11 years, according to a new business survey.
The headline seasonally adjusted S&P Global UAE Purchasing Managers' Index (PMI) posted firmly above the crucial 50.0 mark in June but dropped from 55.6 in May to 54.8.
Non-oil businesses in the Emirates faced intense inflationary pressures leading to a slowdown in purchases and reduced stockpiling efforts. "More than twice as many surveyed firms indicated a rise in their expenses compared to May, leading many to curb spending on inputs," David Owen, Economist at S&P Global Market Intelligence, said.
Nevertheless, helped in part by sustained efforts to lower output charges and offset competitive pressures, firms continued to see a robust increase in new orders in June driving a strong expansion in activity.
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