The UAE’s non-oil private sector regained growth in November mainly due to the growth of new business, according to the monthly survey by Emirates NBD.
The seasonally adjusted UAE Purchasing Managers’ Index (PMI) rose for the first time in four months during November to reach 54.2, up from October’s six-month low of 53.3.
The latest reading was above the 2016 average of 53.8, the report said.
Jobs growth last month also accelerated to a four-month high, with a number of businesses requiring extra manpower to cater for new projects.
However, the pace of hiring remained below the series average and only modest overall, the report said.
Khatija Haque, head of MENA Research at Emirates NBD, said: “The November PMI data is encouraging as it continues to point to strong activity growth in the UAE, even as external demand remains soft. However, the environment remains competitive, and margins continue to be squeezed by rising input costs and declining output prices.”
Data showed that the growth of new business picked up from the relatively subdued pace seen in the preceding two months.
Surveyed firms attributed the increase in new orders to successful marketing initiatives, including price discounting. Companies lowered their charges on average for the 13th straight month.
However, the rise in total new work was hampered by another fall in new orders from abroad during November. The rate of decline eased to the weakest in the current five-month downturn.
Meanwhile output continued to increase “substantially” with respondents mentioning raising activity in response to new projects.
With new orders and output requirements rising, purchasing activity also grew in November, with the rate of pre-production inventory building also picking up. Some firms associated higher stocks with healthy demand projections.
Total input costs also rose for the second straight month in November.
On the price front, charges continued to fall despite higher purchasing costs due to greater competition. Some panellists indicated that they had offered discounts as part of sales initiatives, the report found.