Dubai: As per the latest PMI update from S&P Global, the businesses in the UAE registered a substantial increase in new orders during January- and were simultaneously hiring more than in previous months.
The new accumulations in the workforce came as a surprise because UAE businesses had slowed down due to new hires because of the considerations about a decrease in the global economy from the recession. Though fewer job hires were seen as one way of lowering operational costs.
However, the recruitment process took longer than usual and contributed to rising backlogs for the businesses.
David Owen, Senior Economist at S&P Global Market Intelligence, stated, ” The January results exhibited that the non-oil sector remained in good health and comparatively favorable against a global economic slowdown towards the end of 2022.
It also stated, “Activity levels jumped up in response to another market boost which was the lowest for 16 months”.
Weak Exports
UAE businesses saw a decrease in exports, which S&P Global gave credit as a ” weak global condition .”The foreign sales have reduced at the rate since June 2021.
As per David Owen, ” When the UAE PMI was one year low of 54.1 in January, it continued to signal a robust improvement in the business conditions at non-oil companies at the beginning of 2023.”
A slight dip in PMI
The January PMI reading indicates 54.1, down to 54.2 in December and the lowest in January 2022.
The growth in January was pushed by the higher sales, while the businesses put more effort into marketing and completing existing projects. Still, the confidence level in the future remained downward.
Owen further stated, ” Despite improving slightly from the lower December rate, the confidence level remained the weakest in the series in history. “
Inflation Receding?
As per S&P Global findings, the January data recorded a lack of inflationary pressures for the private oil sector.
Discounts get into the act.
UAE firms made additional cuts in their average prices. The fair discount is higher than in December and was ‘ fastest for five months, with the firms who chose to offer price promotions for attracting sales.’
Conclusion
The above report stated the condition of the UAE regarding global growth, wherein new orders were made in January in the private sector.
