UAE – Mubasher: The headline seasonally adjusted UAE Purchasing Managers' Index (PMI) registered 55.6 in December 2021 amid a strong improvement in business conditions.
UAE’s PMI in December was down slightly from November's 29-month high of 55.9, according to IHS Markit report on Wednesday.
The UAE non-oil economy’s growth was running at a marked pace throughout the fourth quarter (Q4) of 2021 in line with the kick-off of the Expo 2020 and softer travel restrictions.
There was a further strong expansion in new business, while production levels rose at the fastest pace in nearly 2.5 years.
Businesses also witnessed a much stronger increase in cost pressures due to higher energy and fuel prices.
“Overall purchasing costs rose at the sharpest rate since March, which often dissuaded firms from purchasing extra inputs,” according to the report.
Economist at IHS Markit, David Owen, said: “The next few months may prove more challenging, however, depending on how the Omicron variant impacts worldwide travel and local restrictions.”
He added: “Businesses also face the prospect of higher inflation, after the latest data indicated the fastest rise in purchase costs for nine months due to an increase in energy and raw material prices."
Higher new orders endorsed expansion in the UAE’s non-oil private sector activity in December. “In fact, the upturn was the most marked since July 2019, with around a quarter of respondents seeing an increase in output from November,” the report added.
