UAE Banking Market Update
mn bpd
2.3
2.2
2.1
2.0
2.4
2.5
2.6
UAE Economic Update
Highlights
Real GDP Growth Forecasts
Estimated UAE GDP growth for 2011 remains 4.6% largely on the back of higher
oil production, but risks are skewed to the downside for 2012 in the context of
recent global developments
GDP growth forecasts for US (1.5%), Japan (0%) and China (9%) has been
lowered for the year 2011 while GDP growth forecasts has also been lowered for
the year 2012 for US (2%) and Eurozone (1%), since forecasts made earlier this
year.
PMI data indicated strong private sector growth in H1 2011, but Q3 2011 data
showed a sharp slowdown in private sector activity, reflecting the impact of
weaker global growth although potentially impacted by seasonal factors
Local inflation remains subdued at 0.6% y-o-y in Aug, despite rising food
costs; declining housing costs are expected to continue to contain headline CPI
and average forecasted inflation this year of 1% is one of the lowest inflation rates
in the region.
Oil production rises in Sep after dipping in June
2008
2009
2010
2011F
2012F
UAE
7.4%
(1.6%)
(1.4%)
4.6%
4.2%
UK
(0.1%)
(4.9%)
1.4%
1.0%
1.5%
Eurozone
0.3%
(4.1%)
1.7%
1.5%
1.0%
Germany
0.7%
(4.7%)
3.5%
3.5%
2.0%
US
0.0%
(3.5%)
3.0%
1.5%
2.0%
China
9.6%
9.2%
10.3%
9.0%
8.5%
Japan
(1.2%)
(6.3%)
4.0%
0.0%
2.5%
1.8%
(0.8%)
14.5%
5.6%
4.5%
2.2%
(2.7%)
7.0%
5.3%
5.5%
Singapore
Hong Kong
Source: Global Insight, Emirates NBD forecasts
UAE PMI – private sector expansion slows sharply
140
60
60
120
100
55
80
60
40
USD per barrel
50
50
45
20
0
40
40
Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11
UAE (lhs)
--- UAE Quota (lhs)
Source: Bloomberg, Emirates NBD Research
Emirates NBD
OPEC oil price (rhs)
Aug-09
Sep-09
Source: HSBC, Markit
Oct-09
Nov-09
Dec-09
Jan-10
Feb-10
Mar-10
Apr-10
May-10
Jun-10
Jul-10
Aug-10
Sep-10
Oct-10
Nov-10
Dec-10
Jan-11
Feb-11
Mar-11
Apr-11
May-11
Jun-11
Jul-11
Aug-11
4View entire presentation