UAE business growth soars to record high

HSBC's UAE purchasing managers index, a measure of private sector health, rose to a record peak last month.

Business growth rose to a record high last month, indicating a strong start to the new year for the country's private sector.
Expansion in new orders, business activity, employment and purchasing all accelerated, according to HSBC's purchasing managers' index, released yesterday.
"It's another encouraging reading, consistent with our view of the UAE as an economy firmly in recovery mode," said Simon Williams, chief economist for the Middle East and North Africa at HSBC.
The headline seasonally adjusted HSBC PMI rose to a peak of 54.2 in January, up from 53 the month before. The survey began in August 2009.
Nevertheless, rising prices of fuel and other commodities squeezed companies' profit margins. Firms hiked their output prices, which increased at the steepest recorded in the survey history.
But given the pace of recovery and excess spare capacity within the economy, Mr Williams said he would be surprised if the rise in output prices led to a significant uptick in inflation.
A rise in output growth enabled firms to raise their charges at the fastest pace recorded.
New business receipts also increased at their quickest rate in 14 months, according to the survey. Domestic demand was the main driver of new order growth, with new export business rising at a weaker rate.