The S&P Global United Arab Emirates PMI edged up to 53.5 in June 2025 from 53.3 in May, which was the softest expansion in over three years. The modest uptick masked diverging trends, as a sharper rise in output and stabilized inventories offset a slowdown in new order growth, which fell to its lowest level since September 2021.
Businesses cited geopolitical tensions, particularly between Israel and Iran, as a key factor weakening client demand. Despite softer sales, firms raised output to clear backlogs, which expanded at the slowest pace in 17 months. Employment rose again, though at a slower pace. Meanwhile, supplier delivery times lengthened at the slowest rate since April 2024, while purchasing rebounded modestly, helping stabilize inventories after May’s record drop. On prices, input cost inflation eased to a near two-year low, while selling prices dipped slightly. Confidence improved to its highest since November 2024, with hopes for stronger sales if regional tensions ease.
