Dubai: Dubai economy’s three key sectors – retail, travel and tourism, and construction – did enough to ensure that private sector activity during July ‘continued to expand sharply’. Growth has ‘strengthened five times in the past six months’, according to the latest PMI data from S&P Global.
The July PMI (Purchasing Managers Index) is at 56.4 against June’s 56.1, signalling businesses are winning more orders and sales even as their costs recorded the sharpest increase in about four-and-a-half-years. And that will remain a worry.
"Input price inflation remained among the fastest on record despite slowing from June's 53-month high," said David Owen, Senior Analyst at S&P Global. "Fuel prices again impacted firms' costs, notably in the travel and tourism sector where input prices rose the most since this index began in 2015."
Jobs keep getting added
Businesses in Dubai were certainly employing more, for a third success month and in line with a trend that’s been there since January 2021. “The rate of job creation (in July) was the joint fastest registered in 2022 so far,” said S&P Global in the update. “All three key sectors registered higher employment in July, with the sharpest increase in travel and tourism.”
Dubai’s optimism
Overall, businesses across sectors are optimistic regarding growth in new activity over the next 12 months. Even then, the ‘strength’ of that optimism eased from June's eight-month peak and ‘below the long-run series average’. The exception to this was from the travel and tourism sector, where sentiment buoyancy runs strong with each new travel plan being booked with airlines and agencies. In fact, optimism in the sector is at the highest point since November 2021.
There was also evidence of rising pressure on firms' selling prices. Although overall charges levied for goods and services were broadly unchanged since June, this ended a 12-month sequence of discounting
