Dubai: UAE's private sector activity continued to turn in a decent performance during summer, with the July data showing "sharp expansions" in output and new work.
Businesses also managed to push up inventories and even added to their employment rolls though in low numbers, says the new update from Emirates NBD.
But on the negative side, export orders dropped by the quickest pace since the monthly surveys started. This is the second straight month that export orders have seen a dip. The rate of contraction was sharp overall, with the respective index falling to a record low, the survey finds.
Plus, "On the price front, firms faced stronger input cost inflation, but were unable to pass these on to consumers amid intense competitive conditions," the report adds.
But local businesses are looking to the bigger picture, and in doing so they sense a reason to be optimistic.
"Firms were more optimistic about the coming year, and increased inventories at a record rate, partly in anticipation of further order growth,” said Khatija Haque, Head of MENA Research at Emirates NBD.
The survey, sponsored by Emirates NBD and produced by IHS Markit, contains data collected from a monthly survey of business conditions in the UAE non-oil private sector.
The seasonally adjusted Emirates NBD UAE Purchasing Managers’ Index rose to a three-month high of 56.0 in July from 55.8 in June. This was indicative of a "sharp improvement in operating conditions in the non-oil private sector".
A combination of more projects and favourable economic conditions was reported by panellists as having contributed to greater business activity, it adds.
On the price front, average input costs rose for a second consecutive month and inflation was solid overall.
