According to S&P Global’s August survey, the UAE PMI reading of 55.3 marked the strongest improvement in operating conditions since December 2024. This was also the second consecutive month of faster growth after a mid-year soft patch. Reuters reporting on the same release noted that stronger output and new business growth underpinned the PMI jump, with UAE shares rising after the data.
The survey showed output expanding at the fastest pace since December 2024, as firms reported a rise in new orders and firmer client demand across key non-oil sectors. Meanwhile, sentiment around future activity stayed positive, supported by expectations of continued demand and ongoing investment. The UAE Central Bank currently projects real GDP growth of 5.6 percent in both 2025 and 2026, with non-hydrocarbon activity playing a larger role.
UAE Regains Momentum as Gulf’s Core Non-Oil Growth Market
This latest UAE PMI rebound follows a sharp slowdown in June, when S&P Global data showed the index falling to 50.8, its weakest level in five years, before improving to 52.7 in July. As a result, August’s print signals that the earlier hiring and demand slump is now giving way to a more stable expansion phase. One analyst summary of regional PMIs noted that the GCC’s non-oil economies showed resilience in August, led by the UAE’s 55.3 reading.
For equity and fixed-income investors, the combination of stronger PMI data and central bank growth estimates points to robust underlying private-sector demand across the Emirates, even as firms continue to manage cost pressures and hiring decisions. The UAE has reasserted itself as the Gulf’s main non-oil growth anchor heading into late 2026. Readers tracking the broader Gulf growth story may also find the UAE’s August non-oil PMI surge to a 20-month high a useful companion data point from earlier in the cycle.
How Do Saudi Arabia and Kuwait Compare, and Why Does It Matter?
Regional PMI data show that this is not a standalone story. Riyad Bank’s Saudi Arabia Purchasing Managers’ Index rose to 53.8 in August from 53.1 in July, reaching a six-month high and marking a fifth straight month of expansion in the Kingdom’s non-oil private sector. Analysts highlight stronger output and improved expectations, even though the reading remains below the survey’s long-term average.
In addition, a regional economic outlook from economist Nasser Saidi noted that Kuwait’s PMI reached 53.6 in August, also a six-month high and its strongest improvement since the regional conflict began. Gulf News reporting on the S&P Global PMI series echoed this, stating that business conditions strengthened across several major Arab economies in August, with the UAE, Saudi Arabia and Kuwait all posting faster non-oil growth.
By contrast, some other regional economies are still closer to stabilisation than outright expansion. Arab News coverage of the wider MENA PMI releases observed that Egypt’s PMI, while improving, has yet to move decisively into growth territory. As a result, the Gulf’s performance stands out as a relative bright spot for investors tracking non-oil activity and corporate earnings momentum.
What the August Data Signal for Capital Markets
For capital markets, the August data send several signals. First, the UAE PMI rebound suggests that the summer lull and June’s hiring downturn have not derailed the medium-term non-oil growth story. Second, Saudi Arabia’s and Kuwait’s higher readings align with the view that regional non-oil activity is gaining pace even amid geopolitical tensions. Finally, stronger survey data support the case for continued flows into UAE and GCC equities, real estate and private credit that are exposed to domestic demand rather than hydrocarbon price swings.
Investors should now watch whether September and Q4 PMI readings confirm this August momentum, how hiring and wage trends respond after the earlier contraction, and whether policy support and Vision-style programmes across the Gulf sustain this non-oil rebound into 2027.
Quick answers
The S&P Global UAE Purchasing Managers’ Index rose to 55.3 in August 2025, up from 52.7 in July, marking the strongest improvement in operating conditions since December 2024.
Riyad Bank’s Saudi Arabia PMI reached 53.8 in August — a six-month high — while Kuwait’s PMI hit 53.6, also a six-month high, both below the UAE’s leading 55.3 reading.
The UAE Central Bank projects real GDP growth of 5.6 percent in both 2025 and 2026, with non-hydrocarbon activity playing an increasingly significant role in that expansion.
