The United Arab Emirates non-oil economy rose to a four-month high in March, continuing to recover from a four-year low hit in January.
The latest monthly Purchasing Managers’ Index, produced for Emirates NBD bank by data firm Markit, showed it climbing to a four-month high of 54.5 in March, up from 53.1 in February.
The index is based on a survey of purchasing managers in the non-oil private sector and is designed to give a broad overview of economic activity. A reading above 50 indicates an expanding economy, and below shows it receding.
Though March PMI showed continued growth, Emirates NBD noted that the index level over the whole of the first quarter was the weakest first quarter 2012.
“While the improvement in … March is encouraging, the average PMI for first-quarter 2016 signals a further slowdown in the non-oil private sector of the UAE at the start of this year,” Khatija Haque, head of Middle East and North Africa research at Emirates NBD, said.
“Nevertheless, the solid growth in output and new orders in the first quarter suggests that domestic demand is holding up well despite the headwinds of a strong US dollar and low oil prices,” he added.
To the extent that the non-oil sector was stronger, it was driven by increases in output and new orders. The report noted that input costs grew only modestly, allowing companies to lower prices amid tougher competition.
Still, non-oil exports fell for the first time in six months.
Employment was up for the 51st consecutive month, though at a slower rate than February. Also, there was a marginal drop in salaries, the first since December 2011.
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