United Arab Emirates Economic Outlook
May 8, 2018Economic growth in the non-oil sector appears to have moderated somewhat in Q1 after the government implemented VAT in January, with PMI data pointing to slowing output growth throughout the quarter. The tourism sector seems to have performed particularly well in Dubai, however, momentum in construction in the city likely slowed in Q1. This unexpected slowdown could be worrying if sustained, especially given the high level of infrastructure investment by the government in preparation for the 2020 World Expo. Nevertheless, the PMI and forward-looking business confidence improved in April, and a flurry of measures announced on 14 April by the government of Dubai, aimed at reducing the cost of doing business and cutting red tape, should help renew economic momentum in the coming quarters.
United Arab Emirates Economic GrowthLooser fiscal policy, and notably large investments in infrastructure, should prop up growth in the non-oil economy this year by supporting private investment momentum, while a new investment law set to be unveiled by the end of year should further boost FDI inflows. This, along with higher oil prices and tourism, is poised to help private consumption bounce back from the VAT implementation. On the other hand, the OPEC agreement should keep oil output largely stable in the year. The main risks are a flare up of regional tensions, which could harm investment, and a downturn in oil prices. Met the why particular panelists expect GDP to increase 2.7% in 2018, which is down 0.2 percentage points from last month’s forecast, and 3.2% in 2019.
United Arab Emirates Economy Data
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United Arab Emirates Facts
|Exchange Rate||3.67||0.0 %||May 16|
|Stock Market||0.4||0.75 %||May 16|
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United Arab Emirates Economic News
May 3, 2018
The Emirates NBD Purchasing Managers’ Index (PMI) increased to 55.1 in April from 54.8 in March on the back of a pick-up in new orders growth, following three consecutive months of decline in the index following the implementation of VAT in January.
April 23, 2018
Consumer prices fell 0.65% in March from the prior month, a sharper decline from February’s 0.15% month-on-month fall.
April 3, 2018
The Emirates NDB Purchasing Managers’ Index (PMI) fell marginally from 55.1 in February to 54.8 in March.
March 24, 2018
Consumer prices fell 0.15% in February from the prior month, a significant downswing from January’s 2.67% month-on-month increase.
March 5, 2018
The Emirates NDB Purchasing Managers’ Index (PMI) fell from January’s 56.8 to 55.1 in February.