Dubai private sector rebounds in March

Dubai's private sector recorded a solid rebound in business conditions in March after a slight deterioration in February.

Driven by an upswing in three key sectors, Dubai's private sector recorded a solid rebound in business conditions in March after a slight deterioration in February.
As private sector firms reported most upbeat business outlook since September 2015, a return to growth was recorded across all three key sub-sectors monitored by Emirates NBD Dubai Economy Tracker survey in March. 
Travel & tourism was the strongest performing category of activity, followed by wholesale & retail and construction, Emirates NBD said.
The seasonally adjusted Emirates NBD Dubai Economy Tracker Index - a composite indicator designed to give an accurate overview of operating conditions in the non-oil private sector economy - rose to 52.5 in March, up from 48.9 in February.
A reading of below 50.0 indicates that the non-oil private sector economy is generally declining; above 50.0, that it is generally expanding. A reading of 50.0 signals no change.
The bank said private sector companies in Dubai pointed to a robust expansion of business activity during March, with the rate of growth the fastest for four months.
"Anecdotal evidence suggested that more favourable economic conditions, the launch of new projects and a recovery in clients' willingness to spend had all contributed to the rebound in overall business activity," it said.
Job creation was maintained across the private sector in March, thereby continuing the current period of expansion that began at the start of 2012. Although still subdued in comparison to the long-run survey average, the latest upturn in employment numbers was the fastest since November 2015.
In tandem, the Dubai Financial Market index, a key indicator of business confidence, also has witnessed significant gains over the past three months. The DFM index closed at 3,433.69 on Sunday, up 32.5 per cent since hitting an intra-day low of 2,590.72 on January 21, 2016.
Khatija Haque, head of Mena Research at Emirates NBD, said the survey for March suggests that after a slow and uncertain start to 2016, activity appears to have picked up at the end of first quarter. "Output and new order growth across key sectors were solid in March and firms were more optimistic about prospects for the coming year."
According to the survey, new work received by private sector companies in Dubai returned to growth in March, signalling a rebound from February's marginal decline. "A number of firms cited stronger than expected sales wins, supported by successful marketing and promotional strategies. All three key sub-sectors recorded an upturn in overall new business."
Survey respondents were also much more upbeat about the business outlook in March. Around one-third of the survey panel anticipate an upturn in business activity, while only four per cent forecast a fall over the year ahead. As a result, business confidence was the highest since September 2015, with firms pointing to hopes of an improvement in underlying economic conditions.
Input prices were broadly stable across the private sector in March. Construction and wholesale & retail firms recorded input price pressures, while travel & tourism companies signalled a reduction in their average cost burdens.
issacjohn@khaleejtimes.com