The UAE’s non-oil private sector recorded its fastest economic growth since December 2024 in August, signaling a recovery in the sector and companies’ ability to adapt to the repercussions of the war involving Iran, according to the latest Purchasing Managers’ Index (PMI) data from S&P Global.
The seasonally adjusted headline UAE PMI rose to 55.3 points in August, up from 52.7 points in July, remaining comfortably above the 50-point threshold that separates growth from contraction.
The PMI data showed that the increase in activity last month was driven primarily by a sharp rise in new orders, which reached their strongest level — alongside another month — in more than two years. The improvement was also supported by faster output growth, higher inventories, easing supply constraints and lower price pressures.
More Effective Adaptation
David Owen, chief economist at S&P Global Market Intelligence, said the UAE’s non-oil economy had “decisively moved into a higher gear,” noting that the August PMI results reflected companies’ greater ability to adapt to current market conditions.
He added that demand growth accelerated, while supplier delivery times improved and cost pressures eased, pointing to a broad-based improvement in domestic economic conditions.
According to the survey results published by S&P Global, the strong improvement in August was driven by a combination of faster sales growth and renewed inventory-building by companies.
Surveyed businesses also reported an improvement in customer activity, which S&P Global said coincided with a steady, though incomplete, easing of economic caution stemming from the conflict in the Middle East.
Export demand also improved in August, marking its second consecutive month of expansion.
