UAE Business Conditions Worsen for Second Straight Month
(Bloomberg) -- Business conditions in the United Arab Emirates deteriorated for a second straight month in November amid subdued demand.
Non-oil private sector activity in the Gulf nation worsened last month partly due to the first decline in output since May, weak market conditions and lower customer numbers, according to IHS Markit. Its Purchasing Managers’ Index was unchanged from October at 49.5, staying below the 50 mark that separates contraction from growth.
“The latest data signalled a renewed decline in output across the non-oil economy in the UAE during November,” according to David Owen, economist at IHS Markit. “The sector continued to suffer from weak demand which, despite partly recovering during the summer, is reportedly still much softer than prior to the Covid-19 pandemic.”
- Employment fell last month at the slowest pace since February as some firms noted recalling previously-employed staff, while new orders grew “only slightly”
- Business confidence for growth prospects worsened with companies predicting a decline in output for the first time in the eight-and-a-half-year series history
- Demand conditions were subdued as recovery in activity after the Covid-19 lockdown stalled, while concerns about a renewed spike in virus cases intensified
- New business volumes registered a marginal uptick, though the increase was “only just offsetting the decline seen in the previous survey period”
- Strict lockdown measures in Europe led to a fall in new orders from foreign clients
- Purchase prices dropped for the first time in five months, accompanied by a drop in staff costs
- Pressure on supply chains eased after a slight increase in lead times during the previous month
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