Business conditions in the UAE’s non-oil private sector remained robust in September, with activity holding at a 20-month high as companies raised selling prices at the quickest rate in more than 15 years.

The S&P Global UAE Purchasing Managers’ Index remained unchanged at 55.3 in September, matching its August level. Any reading above 50 indicates that business conditions have improved from the preceding month.

The latest survey showed that stronger customer demand enabled firms to transfer increased costs to buyers. Selling prices rose at the fastest pace since May 2011, broadly in line with the increase in companies’ input costs.

Activity accelerates while orders continue to rise

Output across the UAE’s non-oil economy expanded at its fastest rate since February, before the outbreak of conflict in the region. Surveyed firms pointed to a larger customer base and a solid flow of incoming work across several sectors.

New orders continued to increase in September, although their growth eased from August. International demand provided additional support, with new export orders rising for a third consecutive month and recording their strongest increase since November 2024.

The PMI is based on a monthly survey of purchasing managers at about 1,000 non-energy private-sector companies. The September data was gathered between September 10 and 24.

Dubai records strongest PMI reading in seven months

Dubai’s PMI climbed to 54.5 in September from 54.1 in August, marking its highest level in seven months. Business activity in the emirate increased at the fastest pace seen so far in 2026.

New orders rose sharply in Dubai, supported by export demand that grew at its strongest rate in two years. Companies added staff, but the rise in employment was not enough to prevent outstanding work from increasing.

Businesses in Dubai also raised their selling prices at the steepest rate since January 2014, reflecting efforts to recover higher operating costs.

Input costs rise amid materials and freight pressures

Higher charges for raw materials and increased freight costs contributed to the rise in input prices. Firms used the improved demand environment to raise prices and rebuild margins after a period of sustained cost pressure.

David Owen, principal economist at S&P Global Market Intelligence, said the figures indicated that the non-oil economy had “moved past the mid-year slowdown” associated with the Middle East conflict.

He said firms appeared to be taking advantage of stronger demand to restore margins. He also noted that volatile oil markets and continuing constraints on shipping routes could keep both costs and selling prices elevated.

Employment recovers modestly as firms remain cautious

Companies returned to hiring in September after reducing headcount in August, though job creation was only modest despite the increase in new business. Backlogs of work therefore rose again, although at a slower pace than the month before.

Purchasing activity also increased. Companies bought construction-related materials, including concrete and steel, as well as electrical goods. Stocks of inputs expanded at the quickest pace since November 2023.

Supplier delivery performance improved for a fourth straight month. Despite the generally positive activity data, businesses continued to show caution in their outlook.