Business activity in the UAE's non-oil private sector rose to its highest level in 12 months in February 2026, driven by accelerated production and new orders. Supply chains improved further, supporting efforts to increase inventories, while lower fuel prices helped contain pressure on the prices of production inputs. The main UAE Purchasing Managers' Index (PMI), compiled by S&P Global, rose to 55 points in February from 54.9 in January, reaching its highest level in a year. UAE non-oil companies continued to expand their activities at a rapid pace in February, with the growth rate accelerating to its strongest level since April 2024. Companies participating in the index study attributed the significant increase in production primarily to favorable demand conditions, successful contracts, targeted marketing efforts, and growth in sectors such as construction, real estate, logistics, and technology. This positive trend was further boosted by a notable rise in new orders, as February 2026 data showed a sharp increase that was only slightly below the high level recorded in the preceding January, which was near a two-year high. Several companies noted the contribution of rising tourism, expansion of e-commerce channels, and increased demand for AI-related products. Efforts to increase staffing continued in February, with employee numbers rising slightly, marking the largest increase since November 2025. UAE non-oil companies also managed to increase their inventories of purchased production inputs for the second consecutive month, supported by another rapid improvement in supplier delivery times. Suppliers, in turn, showed greater flexibility in their supply chains and were able to ship products faster in response to buyer demand-driven inquiries. Strong demand rates continued to fuel positive future activity expectations, with production forecasts strong for the next 12 months. David Owen, a senior economist at S&P Global Market Research, said: 'The UAE's non-oil PMI showed the strongest business conditions growth in a year in February, with production increasing rapidly in response to strong new business inflows. To date, the data points to a promising picture for the domestic economy in Q1.' Owen added: 'The outlook is also positive, as demand continues to pressure companies' operating capacities, suggesting the likelihood of further increases in production and hiring.' Meanwhile, the Dubai PMI recorded the highest employment level in two years, with companies highlighting increased opportunities and new projects, as well as marketing activities, AI adoption, population growth, and rising tourism contributing to increased demand. Dubai's non-oil companies reported increased efforts to boost staffing in February, with hiring rates rising steadily, the fastest pace in two years, aligning with positive future activity expectations.
