29 November 2024
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Dubai announces new R&D spending

Daily Outlook - 29 November 2024

By Edward Bell

Dubai has announced an AED 750m programme to advance the emirates “knowledge-based, technology-driven economy” through partnerships with international universities and encouragement of private sector research and development. The programme also aims to increase the “innovation sector’s” share of GDP to 2.5% by 2033.

The UAE’s energy minister, Suhail al Mazrouei, said the country will increase its production of solar power until the end of the decade, launching “one or two” solar projects per year to match fast growing energy demand in the country.

Saudi Arabia’s money supply picked up in October with the monetary base up by 0.7% m/m. An increase in savings deposits was behind the expansion in overall money supply. Net foreign assets in Saudi Arabia dropped in October to SAR 1.546trn, down from 1.626trn a month earlier.

Inflation in Germany was steady at 2.4% y/y in November, coming in under market expectations of an acceleration. Core inflation in Germany was faster at 3% y/y in November according to preliminary estimates, up from 2.9% a month earlier. Inflation in the wider Eurozone has come close to target levels in recent prints but did pick up in October to 2% from 1.7% a month earlier. Markets are expect a cut from European Central Bank when it meets in December.

Today’s Economic Data and Events

  • 11:00 TU GDP y/y Q3: forecast 2.5%
  • 14:00 EC CPI y/y Nov: forecast 2.3%
  • 14:30 IN GDP y/y Q3: forecast 6.5%
  • 17:30 CA GDP y/y Q3: forecast 1.1%

Fixed Income

  • US Treasury markets were closed overnight for the Thanksgiving public holiday in the US. Markets have opened on a positive footing in early trade today. Bond markets in Europe were stronger overnight with yields lower across most geographies. Emerging market bonds were also supported overnight.

FX

  • Currency markets were relatively quiet overnight with the dollar mixed against peers. EURUSD was lower by 0.1% at 1.0552 while GBPUSD gained marginally to close the day at 1.2687. USDJPY was higher by 0.3% at 151.55.
  • Commodity currencies closed mixed with both CAD and AUD weaker against the US dollar while NZD managed a second day of gains, rising by 0.1% to 1.4014.

Equities

  • European markets had a positive session overnight with the Euro Stoxx index up 0.5% and the FTSE marginally higher. US markets were closed for the public holiday.
  • Local markets settled mixed. The DFM gained by 0.4% while the ADX dropped by about the same amount. In Saudi Arabia the Tadawul added 0.4%.
  • Salik plans to increase its toll fares during rush hours during Dubai to AED 6 per passing from AED 4 at present. The new pricing will begin at the end of January according to the RTA.

Commodities

  • Brent markets drifted higher in limited trading with the international benchmark at USD 73.28/b, up 0.6%. WTI was closed. OPEC+ has announced it will delay its online meeting until December 5 th, several days later than initially planned due to some ministers reportedly attending a GCC summit. OPEC+ currently plans to increase production in January, having delayed returning output twice so far this year, and they may need to push back plans even further in to 2025 as oil market conditions stay soft.
  • Several regional countries will establish a Middle East and North Africa electricity trading network, allowing the export of power between markets. Saudi Arabia and Egypt have built a connection that could allow 3,000 MW of power to be exported from Saudi Arabia to Egypt, according to press reports.

Written By

Edward Bell Acting Group Head of Research and Chief Economist


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