Latest news with #nonOilSector
Khaleej Times
18 hours ago
- Business
- Khaleej Times
UAE businesses stay resilient amid global challenges
The UAE's non-oil private sector is traversing its softest growth in nearly four years, with a key indicator marking its lowest level in May 2025 since September 2021. Despite this slowdown, the sector remains healthy, buoyed by strong demand, strategic diversification, and optimism in global trade, as highlighted by recent survey data. While challenges like global economic uncertainty and US tariffs loom, UAE businesses are adapting with agility, maintaining a competitive edge in a shifting landscape. The S&P Global UAE Purchasing Managers' Index (PMI) dropped to 53.3 in May 2025, down from 54.0 in April. The PMI stayed above the 50.0 no-change threshold, signalling continued expansion. However, the pace of growth in new orders and output has eased, with output growth hitting its weakest mark in 44 months. Companies cited robust client demand, effective marketing strategies, and diverse product offerings as drivers of new orders, though global trade disruptions, particularly US tariffs, tempered momentum for some. The Dubai PMI, holding steady at 52.9, echoed this trend, reflecting solid but slower expansion, with new orders reaching a four-month high thanks to improved client confidence and competitive pricing. A striking development was the record decline in input stocks, the sharpest in nearly 16 years of survey data, as firms streamlined inventories amid slowing growth and supply constraints. Purchasing activity rose at its slowest pace in 28 months, reflecting cautious stock management. Conversely, employment saw a notable uptick, with job creation reaching a one-year high as firms responded to rising workloads. Backlogs of work, while still significant, grew at their slowest rate in 16 months, indicating a slight easing of pressure on capacity. Inflationary pressures softened, offering some relief. Input cost inflation fell to its lowest since December 2023, with only five per cent of firms reporting higher costs, driven by pricier raw materials and transport. Selling prices rose marginally, as some companies passed on costs while others offered discounts to stay competitive. This aligns with broader trends of declining inflationary pressures, a positive signal for businesses navigating cost challenges. Despite the slowdown, UAE firms remain optimistic about global trade. According to HSBC's 2025 Global Trade Pulse Survey, conducted between April 30 and May 12, 2025, 94 per cent of UAE businesses anticipate strong growth in cross-border activities, outpacing global peers. This resilience stands out against a cautious global backdrop, where two-thirds of firms worldwide report cost increases from trade uncertainties. UAE companies, facing an average seven per cent rise in operational expenses due to tariffs, are countering challenges through advanced planning, digital innovation, and market diversification. This positions the UAE as a leader in global trade optimism, even as geopolitical uncertainties ripple worldwide. Business confidence, however, showed signs of moderation. Only 10 per cent of surveyed firms expect expansion in the year ahead, the lowest optimism since January 2025. This tempered outlook, combined with sharp inventory cuts, suggests firms are bracing for softer growth. Yet, the UAE's non-oil sector continues to perform well, supported by strong fundamentals. David Owen, senior economist at S&P Global Market Intelligence, noted: 'While competitive pressures and weaker trade amid US tariffs have weighed on growth, the UAE economy remains robust. The survey data points to easing momentum but also highlights falling inflationary pressures, offering a silver lining.' 'From an overall perspective, the survey signals that the UAE economy is performing well, but the softer increases in output and new orders hint at momentum easing. Furthermore, the sharp cutback in stocks (which was the fastest on record) and the broadly subdued outlook for activity suggest that firms are gearing up for softer growth,' said Owen. 'Positively, the survey data backs up the trend of falling inflationary pressures, as businesses saw input costs rise at their slowest rate since the end of 2023,' he added.
Reuters
a day ago
- Business
- Reuters
UAE non-oil business growth slows in May, PMI shows
ABU DHABI, June 4 (Reuters) - Growth in the UAE's non-oil private sector slowed to its weakest pace in nearly four years in May, a survey showed on Wednesday, as demand remained strong but eased from recent highs. The seasonally adjusted S&P Global UAE Purchasing Managers' Index (PMI) fell to 53.3 in May from 54.0 in April, marking its lowest reading since September 2021, but remained above the 50.0 threshold that indicates growth. The rate of expansion in output was the slowest in 44 months in May, reflecting softening momentum in the non-oil sector even though demand conditions remained supportive. The sub index for output fell to 57.3 in May from 59.4 in April, and was the lowest reading since September 2021. The pace of new order growth remained robust but the sub index dropped to 56.2 in May from April's 56.9 reading, and was the softest in seven months. "Although businesses continued to welcome strong demand from their clients, there were some reports that competitive pressures and weaker trade amid US tariffs had weighed on growth," David Owen, senior economist at S&P Global Market Intelligence, said. The survey highlighted a record decline in inventories as firms streamlined holdings amid slowing growth. The accumulation of backlogs eased to a 16-month low, indicating a softer pace of demand. Business expectations for future output were subdued, with optimism falling to its lowest level since January. Dubai's non-oil private sector growth remained steady, with the headline PMI at 52.9 in May, the same as April, although demand momentum strengthened with the pace of new order growth quickening to a four-month high.
Zawya
2 days ago
- Business
- Zawya
Saudi PMI edges higher as non-oil private firms log output growth
Output growth among businesses in Saudi Arabia's non-oil private sector ticked marginally higher during May, but was softer than in the first quarter, a new survey showed. The seasonally adjusted Riyad Bank Saudi Arabia Purchasing Managers' Index (PMI), rose to 55.8, a shade higher than 55.6 in April. However, it remained much lower than the recent peak of 60.5 at the start of the year. While the PMI is a weighted average of the following five indices: new orders (30%), output (25%), employment (20%), suppliers' delivery times (15%) and stocks of purchases (10%), only the new orders index rose in May. 'Firms reported improvements in demand, new project starts, and greater labour capacity as key drivers. This expansion, though slightly softer, reflects stable operating conditions and continued confidence across the private sector midway through the second quarter,' said Naif Al-Ghaith, Chief Economist at Riyad Bank. The survey showed a marked increase in employment, with the rise in staffing one of the fastest seen in over a decade. 'On the domestic front, firms increased hiring to match rising output needs, while purchasing activity saw its fastest growth since March 2024, supported by improved vendor delivery times and a more agile supply chain,' said Al-Ghaith. Panellists reported an increase in supplier charges for raw materials, with purchase price inflation ticking up to its highest since February. However, selling prices were reduced in May, due to competitive pressures. Optimism regarding the coming 12 months was higher than in April and was the greatest recorded in one-and-a-half years, as companies cited expansion plans and improved demand conditions. (Writing by Brinda Darasha; editing by Seban Scaria)
Zawya
2 days ago
- Business
- Zawya
Egypt's non-oil private sector contraction slows in May, PMI shows
CAIRO - Activity in Egypt's non-oil private sector edged closer to stability in May, with softer contractions in new business and output, according to an S&P Global survey released on Tuesday. The headline seasonally adjusted S&P Global Egypt Purchasing Managers' Index (PMI) rose to 49.5 from 48.5 in April, remaining below the 50.0 threshold that separates growth from contraction. Output and new orders continued to decline, but at a slower pace compared to April, as fewer companies reported cutbacks in customer sales. However, businesses reduced purchasing activity at the fastest rate in seven months and trimmed their workforces, with employment dropping for the fourth month in a row. The output sub-index strengthened to 49.5 from 47.4 in April, while the new orders subindex rose to 49.1 from 47.4. Input price inflation increased sharply, driven by rising supplier charges and volatile exchange rates. This led to a fresh rise in selling prices as firms passed on some of the cost increases to customers. "Although many of the key PMI metrics continued to indicate a deterioration in business conditions in May, the overall pace of decline was not as sharp as in April and softer than the survey's historical trend," said S&P Global Market Intelligence economist David Owen. "Output and new orders fell at the slowest rates for three months, helped by renewed growth in the manufacturing sector." Non-oil businesses in Egypt remained cautious about the future, with optimism slightly improved from April but still weak by historical standards. Concerns over stubborn price pressures and low demand continued to weigh on output expectations, S&P Global said. The future output index improved to 53.0 from 52.7 in April.
Reuters
2 days ago
- Business
- Reuters
Egypt's non-oil private sector contraction slows in May, PMI shows
CAIRO, June 3 (Reuters) - Activity in Egypt's non-oil private sector edged closer to stability in May, with softer contractions in new business and output, according to an S&P Global survey released on Tuesday. The headline seasonally adjusted S&P Global Egypt Purchasing Managers' Index (PMI) rose to 49.5 from 48.5 in April, remaining below the 50.0 threshold that separates growth from contraction. Output and new orders continued to decline, but at a slower pace compared to April, as fewer companies reported cutbacks in customer sales. However, businesses reduced purchasing activity at the fastest rate in seven months and trimmed their workforces, with employment dropping for the fourth month in a row. The output sub-index strengthened to 49.5 from 47.4 in April, while the new orders subindex rose to 49.1 from 47.4. Input price inflation increased sharply, driven by rising supplier charges and volatile exchange rates. This led to a fresh rise in selling prices as firms passed on some of the cost increases to customers. "Although many of the key PMI metrics continued to indicate a deterioration in business conditions in May, the overall pace of decline was not as sharp as in April and softer than the survey's historical trend," said S&P Global Market Intelligence economist David Owen. "Output and new orders fell at the slowest rates for three months, helped by renewed growth in the manufacturing sector." Non-oil businesses in Egypt remained cautious about the future, with optimism slightly improved from April but still weak by historical standards. Concerns over stubborn price pressures and low demand continued to weigh on output expectations, S&P Global said. The future output index improved to 53.0 from 52.7 in April.
