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The UAE’s non-oil private sector activity expanded at its fastest pace in 11 months in November on the back of robust market conditions that boosted new business, according to a business survey.
The seasonally adjusted S&P Global UAE Purchasing Managers' Index (PMI) rose to 54.8 in November from 53.8 in October, marking a nine-month high.
"The upturn was often linked to strong customer demand and healthy sales pipelines encouraged firms to expand both their output and staffing," said David Owen, senior economist at S&P Global Market Intelligence.
New business volumes saw their strongest growth since January supported by a favourable market environment, product innovation, and diversification efforts, the survey showed.
However, input costs rose at the sharpest pace in 14 months due to higher living expenses and pressure on wages.
Employment growth reached an 18-month high, as firms sought step up hiring, particularly as an increase in sales contributed to a sharper rise in work levels.
"However, the sharper rise in employment was accompanied by a steeper increase in wage costs, as firms cited the need to raise salaries in response to cost-of-living pressures and skill shortages,” said Owen.
This added to the overall business costs which could contribute to broader inflationary pressures in the coming months, he added.
Expectations for future activity edged up from October's near three-year low with firms citing strong sales pipelines and a favourable business environment as key factors supporting their optimism
Dubai PMI
In Dubai, PMI held steady at 54.5 in November, on higher sales intakes and improved operating conditions. Hiring increased midway through the fourth quarter, and was the fastest recorded in 18 months.
(Writing by Brinda Darasha; editing by Daniel Luiz)
