Dubai business conditions bounced back to the highest since the pandemic dragged the economy into a downturn, even as weak demand still stands in the way of a recovery.
Dubai , Dubai
11 June 2020, 12:00 AM
30 June 2020, 12:00 AM
Dubai’s economy is starting to recover, still a ‘long way from upturn.’ Though business expectations for the next 12 months inched higher in May, overall sentiment was still the second-weakest in the survey history, a indication of “only modest optimism toward a recovery in output,” according to IHS Markit.
The IHS Markit Dubai Purchasing Managers’ Index rose to 46 in May from a record low 41.7 in April, remaining below the 50 mark that separates contraction from growth.
Thanks to a relaxation of lockdown measures, output and new orders declined at a slower rate, while unemployment had the smallest drop in three months, according to a report on Tuesday.
David Owen, economist at IHS Markit said, “The latest survey data suggested economic conditions remain a long way from recovery in May. Activity is expected to improve in the year ahead, but it remains to be seen how long it will take for the Dubai economy to rebound following COVID-19.”
Among the three monitored sectors, travel and tourism had the steepest contraction for the third month in a row; construction firms reported the sharpest decline in incoming new work
“Businesses highlighted that, despite restrictions on economic activity being partly lifted, weak consumer demand and a slow market response stopped them from making headway into covering their losses,” Owen said.