S&P Global: Production increased significantly in response to new business strength
Index: The performance of the private sector in Dubai recorded its highest level in March since June 2019
The indicator confirmed that activity growth was particularly strong in the travel, tourism and construction sectors.
Photography: Patrick Castillo
The S&P Global Purchasing Managers' Index in Dubai rose from 54.1 points in February to 55.5 points in March, reaching its highest level since June 2019.
S&P Global said in a statement that the index, which measures the performance of the non-oil private sector, indicates a strong improvement in the non-oil private sector, to a greater extent than the average recorded over the 12 years of the study data.
She added that production rose last March at a noticeable rate in response to the strength of new business, and at the same time, improved performance of suppliers enabled companies to increase their inventory for the first time in four months.
The company noted that confidence in future activity rose to its highest level since December, despite a simultaneous rise in cost pressures due to higher energy and raw materials prices.
The most important results of the index, during the month of March, included an increase in demand from customers in March, and they often linked it to raising “Covid-19” measures and an improvement in the level of confidence, in addition to the acceleration of new business growth at a sharp pace, although it remained slightly weaker than the high levels recorded at the end of the year. year 2021.
Production levels have also increased to the most since July 2019, with more than a quarter of firms seeing an increase since February.
Activity growth was particularly strong in the travel and tourism and construction sectors, where the recovery in international tourism and an increase in construction projects led to strong recovery rates.
Following the rapid improvement in business conditions, companies in Dubai were more confident that activity would grow over the next 12 months during the month of March.
The degree of optimism also rose for the second month in a row to the highest level since December, and was slightly above the average recorded in 2021, and the renewal of storage operations for production requirements.
Total inventories also rose for the first time since November of last year, although the rate of increase was slight.
The accumulation of inventory helped reduce supplier delivery times for the third month in a row, which represents the longest streak of improvement in supplier performance since mid-2020, with employment levels raised in March, for the fourth consecutive month.
However, the data indicated that the rise was generally marginal.
Input costs and product prices continued to move in opposite directions in March, with the former seeing an increase for the 14th consecutive month, as many companies highlighted a sharp rise in energy and raw materials prices in the aftermath of the war in Ukraine.
Selling prices have been reduced again, as companies have stated that they are offering discounts and promotions to support the recovery in sales.
The rate of reductions was slightly lower than in February, reflecting some companies passing on increased costs to customers.
• Confidence in future activity rose to its highest level since December.
Follow our latest local and sports news and the latest political and economic developments via Google news