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PMI data shows that slowing sales in August weighed on the growth of UAE's non-oil private sectors.

A survey on Wednesday showed that the growth in the non-oil sector of the United Arab Emirates grew slightly in August, thanks to a faster increase in production, but sales grew at their slowest rate in over four years.

The S&P Global UAE Purchasing Managers' Index, seasonally adjusted (PMI), rose to 53.3 from a 49 month low of 52.9 at the end of July. It remained above the 50 mark which signals growth.

The slowdown in sales growth was attributed to supply chain issues and competition. The New Orders subindex fell from 54.2 in July to 53.1 in August. This is the lowest reading recorded since June 2021.

David Owen, Senior Economic Analyst at S&P Global Market Intelligence, said that "the sales growth in the UAE's non-oil sector weakened again for the fourth consecutive month in August."

The slowdown was a further concern about fading momentum in the economy and made output more dependent on work backlogs.

The output growth rate improved to a six-month peak, with companies reporting increased activity as a result of ongoing projects and the growth of local markets. Purchases fell for the first four-year period, due to reduced stock levels and a weaker demand.

The cost pressures increased, with wage inflation at a 15-month peak, and selling prices rising at the fastest rate in five month as firms passed higher costs on to consumers.

The overall business climate improved in comparison to the previous month. Firms expressed optimism for future growth, citing stable domestic conditions and solid client relationships.

The survey revealed that Dubai's non oil sector continued to grow strongly. Its headline PMI was 53.6 in august, up from 53.5 in the previous month, and supported by the fastest rate of output growth in seven months. Hugh Lawson, Editor and Reporter (Reporting)

(source: Reuters)