UAE’s Non-Oil Economy Sustains Growth Momentum in October Amid Strong Demand

The United Arab Emirates’ non-oil private sector continued to expand in October, supported by solid demand and business activity, according to the latest data from S&P Global. The country’s seasonally adjusted Purchasing Managers’ Index (PMI) stood at 53.8, only slightly below September’s 54.2, signaling sustained growth in the non-oil economy as the year draws to a close.

A PMI reading above 50 indicates expansion, and the October figure reflects a healthy improvement in operating conditions despite a minor slowdown in momentum. The report attributed the performance to strong inflows of new orders, rising output, and steady purchasing activity.

“The UAE PMI continued to signal a steady growth rate in the non-oil private sector as we draw closer to the end of the year,” said David Owen, senior economist at S&P Global Market Intelligence. “The pace of new business growth has recovered well since its low in August, supporting increases in output and purchasing activity.”

The report showed that private sector firms recorded significant gains in new projects and sales, driven by improving domestic demand. Businesses also benefited from a slowdown in input cost inflation for the second straight month, allowing many firms to keep output prices stable despite competitive market conditions.

However, optimism among UAE businesses eased to its lowest level in nearly three years, resulting in a slower pace of hiring. “Employment remained a weak spot, with October data showing the slowest rise in job numbers in seven months,” Owen noted. He added that while most companies remain confident about continued demand and favorable market conditions, concerns about rising competition and pressure on profit margins have tempered sentiment.

Across the Gulf region, the UAE’s steady expansion aligns with a broader pattern of resilience among Gulf Cooperation Council economies pursuing diversification away from oil. Saudi Arabia led the region with a PMI of 60.2 in October, indicating strong non-oil sector growth, while Kuwait and Qatar posted readings of 52.8 and 50.6, respectively.

In Dubai, business activity accelerated further, with the emirate’s PMI reaching a nine-month high of 54.5, up from 54.2 in September. Non-oil companies in the city reported stronger new order inflows, fueling a sharper rise in output. Employment in Dubai also increased for the seventh straight month, though the pace of job creation remained moderate.

Despite easing business confidence, the latest PMI data underscores the UAE’s ongoing economic resilience, supported by sustained demand and a diversified non-oil growth strategy that continues to attract investment and strengthen private sector performance.