Dubai: Dubai’s private sector has recorded its biggest monthly growth in sales since October 2019, as the speedy vaccine rollout kept delivering confidence boosts. Also in April, businesses were reporting increases in output as well as new orders.
Interestingly, it was the travel and tourism sector that delivered the biggest performance bounce, even though travel from the UK was cut off and towards the end of April, flights to India were stopped because of the mounting COVID-19 infections there.
But the sector’s performance suggest increasing hopes of a rise in tourism activity later in the year, boosted by the rapid vaccine roll-out,” said David Owen, economist at IHS Markit, the research firm that tracks monthly numbers of private sector activity in key economies. “After recording a decline throughout the first quarter, new work rose at the strongest rate since the end of 2019.”
But confidence levels remain below the average seen since the IHS Markit readings of the economy began in 2012.
Interestingly, the report notes that new jobs were created in Dubai’s private sector workforce, leading to a third increase in four months, and “reflecting efforts to rebuild business capacity”. If so, this is quite a contrast to what’s happening UAE-wide, with IHS Markit noting that employment numbers actually fell during April.
53.5%The Purchasing Managers' Index for Dubai's private sector rose from 51 in March to 53.5 in April, signalling a "solid expansion". The reading was also the highest recorded since November 2019, suggesting the economy is moving closer to its pre-COVID growth trajectory.
Price gains too
As demand was firming up, there was also an end to falling output charges - prices were lifted for the first time in three years. In another positive, cost inflation eased from March and was slower than the rate of selling charge inflation. "This signals a slight improvement to operating margins after a long period of pressure from price discounting,” Owen notes.