Dubai's private sector activity strengthens in February: ENBD

Business conditions in Dubai’s non-oil private sector economy continued to strengthen in February, at a pace similar to that of January, Emirates NBD said on Monday.

Total business activity rose at the fastest rate in nine months, while new business increased at a pace that remained above the 2018 average despite easing since January. Employment, however, fell at the fastest rate since the survey began in 2010, it added.

The seasonally adjusted Emirates NBD Dubai Economy Tracker Index remained unchanged from January’s seven-month high of 55.8 in February.

Companies in the wholesale and retail sector reported the firmest volume growth last month, as the headline index for the sector rose to an eight-month high of 58.1. The travel & tourism and construction sector indices stood at 56.8 and 54.0, respectively.

A level above 50 means business is expanding and below 50, contracting.

“The growth in the volume of output and new work has been underpinned by continued price discounting, particularly in the wholesale & retail trade sector," said Khatija Haque, Head of MENA Research at Emirates NBD.

"Firms’ margins continue to be squeezed as selling prices have declined on average for the last 10 months, while input costs have increased over the same period.  As a result, rising new orders have not translated into increased hiring and job growth in the private sector. Indeed, employment declined at the fastest rate on record in February,” she added.