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Growth in the UAE non-oil private sector picked up pace in October driven by new orders, climbing to the highest level in over four years, business survey showed on Friday.
The seasonally adjusted S&P Global UAE Purchasing Managers' Index (PMI) surged to 57.7 in October from 56.7 in September to the highest level since June 2019, indicating a robust improvement in the health of the sector.
Sharply rising new order intakes supported a marked increase in activity, as well as further additions to purchasing and staffing levels, the survey showed.
"Strong economic conditions in the non-oil sector extended into the final quarter of the year, as October PMI results signalled a new recent record for new business growth. Rising at the fastest rate since June 2019, new order volumes provided additional support to output which continued to rise markedly," said David Owen, Senior Economist at S&P Global Market Intelligence.
At the same time, rising fuel and material prices rose in October taking inflationary pressures to a 15-month high. Due to this firms hiked their own selling prices for the first time in a year-and-a-half, albeit only fractionally as they continued giving discounts.
"After dropping to a recent low of 1% in July, headline inflation could therefore pick back up in forthcoming readings," said Owen.
The rise in new orders index led to firms boosting their inventories at the start of the fourth quarter.
Confidence in the 12-month outlook also remained elevated to the second-highest level since March 2020. Robust demand expectations were largely behind the positive outlook, the report said.
(Writing by Brinda Darasha; editing by Seban Scaria)
