Prime Highlights
- UAE firms build inventory at the fastest pace in nearly three years, strengthening supply chain resilience through domestic sourcing.
- Egypt firms resume hiring at the second-fastest pace on record, supported by four-year-high business confidence.
Key Facts
- UAE’s headline PMI rises to 55.3 in August, its fastest business growth pace since December 2024.
- Egypt’s PMI climbs to a seven-month high of 49.6, moving closer to stabilization.
Background
UAE non-oil companies posted their best operating conditions since December 2024. Egypt’s economy, meanwhile, edged nearer to stabilization after a stretch of steady gains, new S&P Global Purchasing Managers’ Index data showed.
The UAE’s headline PMI climbed to 55.3 in August, up from 52.7 in July. Growth accelerated for a second straight month. Companies leaned more heavily on domestic suppliers, cut delivery times and built up inventory at the fastest pace in nearly three years, all part of a broader push to shore up supply chains.
The UAE central bank forecasts real GDP growth of 5.6 percent in both 2025 and 2026, driven by solid hydrocarbon and non-hydrocarbon activity. The IMF said the economy has held firm and expects growth to pick up further in 2027.
David Owen, principal economist at S&P Global Market Intelligence, said demand picked up as delivery times shortened and cost pressures eased. That points to a wide-ranging improvement in domestic business conditions, he said.
Firms are strengthening resilience through localisation, Owen added, increasingly favoring domestic suppliers. At the same time, they are approaching hiring with caution as they plan for longer-term capacity needs.
Egypt’s PMI reached a seven-month high of 49.6 in August, up from 46.8 in July, pushing the sector nearer to growth territory. The IMF projects Egypt’s real GDP will grow 4.6 percent this fiscal year.
Business confidence in Egypt has rebounded strongly, Owen said, with expectations now at a four-year high. That has prompted companies to ramp up hiring at the second-quickest pace on record.
