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The S&P Global UAE Purchasing Managers’ Index climbed to 55 in February 2026 from 54.9 the month before, signalling the strongest improvement in non-oil business conditions in 12 months. Output increased rapidly in response to strong inflows of new work while new orders rose sharply, although at a slightly softer pace than the near two-year high recorded in January. Firms faced limited supply-chain friction as lead times improved rapidly, enabling them to rebuild stocks and better meet client demand, according to the survey.
David Owen, senior economist at S&P Global Market Intelligence, said “The UAE PMI signalled the strongest growth in non-oil business conditions for a year in February, with output increasing rapidly in response to strong inflows of new work.” The expansion was linked to a supportive demand environment, successful contract wins, targeted marketing and growth in construction, real estate, logistics and technology. Companies highlighted increased tourism, e-commerce expansion and demand for AI-related products, with domestic sales accounting for the bulk of the rise.
Employment rose modestly in the non-oil sector during the month, marking the largest uplift since November 2025. Input cost inflation eased while prices charged by businesses increased for the eighth consecutive month, though the rise remained slight amid competitive pressures that limited pricing power. The survey noted a steep increase in outstanding work as companies took on new projects.
Central Bank of the UAE figures show the national economy expanded by roughly 5 per cent in 2025, with non-oil activity growing 4.9 per cent and the hydrocarbons sector 5.4 per cent following faster reversal of oil production cuts under Opec+ quota adjustments. Non-oil sectors accounted for more than 77 per cent of GDP in the first quarter of 2025, a record share that reflects sustained diversification efforts across technology, manufacturing, tourism and finance. According to the Ministry of Economy, non-oil GDP reached AED 352 billion in that period on 5.3 per cent growth.
In Dubai the headline PMI eased to 54.6 in February from 55.9 in January even as job creation hit a two-year high on new projects, AI adoption, population growth and tourism inflows. Price inflation slowed overall with total costs rising at the weakest pace in seven months, although average selling prices increased somewhat faster than in the prior month. Businesses cited marketing activities and government-backed initiatives as additional supports.
Subsequent S&P Global data showed the pace moderating, with the national PMI falling to 52.9 in March and 50.8 by June as geopolitical tensions, cautious spending and competition weighed on activity. Reuters reported the March reading as the lowest since July 2025 while still indicating expansion, with employment declining for the first time in more than four years by mid-2026. Business confidence nevertheless held steady on confirmed contracts and continued public investment, according to the surveys.
