01 February 2021
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Daily Outlook: UAE to allow citizenship for expatriates

Invitations will be limited to specialist doctors, scientists and pioneers in the arts.

By Daniel Richards

  • The UAE has adopted amendments to legislation that would grant citizenship to investors and other professionals including scientists, doctors and their families. Doctors must be specialized in a unique scientific discipline highly required in the UAE, have 10 years of experience and be members of reputable organizations. Scientists are required to be active researchers, with 10 years of experience in the same field. Inventors are required to obtain one or more patents that are approved by the UAE Ministry of Economy or an international body. Intellectuals and artists who are pioneers in the culture and art fields can also qualify.
  • China’s Purchasing Manager's Index (PMI) fell to 51.3 in January from 51.9 in December, showing factory activity growing at the slowest pace in five months as domestic coronavirus infections rise. The official PMI reading showed the sub-index for new export orders stood at 50.2, the fifth straight month expansion, though down marginally from 51.3 in December. China’s services PMI was also lower than expected, falling to 52.4 in January from 55.7 in December.  China reported more than 2,000 cases of the coronavirus, and while the overall number remains small, Chinese authorities are concerned about transmission risks during the Lunar New Year travel season spanning 40 days from January to February - the world's biggest annual human migration. 
  • While Q4 economic growth in Europe’s largest economies was patchy, it was slightly better than analysts had expected, showing some level of resilience despite lockdowns hampering growth dynamics. In Germany, solid exports helped Europe's largest economy eke out 0.1% q/q growth in Q4, but contracting -3.9% y/y. France shrank -1.3% q/q (-5.0% y/y) much less than analysts’ forecasts of a -4.0% q/q (-7.6% y/y) contraction. Spain grew 0.4% q/q in the last quarter of the year, recording its worst-ever annual economic contraction, with GDP falling -11% from 2019's level. Last week, Germany slashed its growth forecast down to 3% this year, revising growth down sharply from an estimate of 4.4% last autumn, a reflection of challenging conditions for Europe’s largest economies this year.
  • US consumer spending fell for a second straight month in December, declining -0.2% m/m amid renewed COVID-19 business restrictions and a temporary expiration in unemployment benefits for Americans. Spending on restaurants and recreation declined, while outlays at hospitals also fell as patients stayed away for fear of contracting the virus. When adjusted for inflation, consumer spending declined -0.6% m/m in December after dropping 0.7% m/m in November. This sets a lower base for consumer spending in Q1 2021. The core PCE deflator, the Fed’s preferred measure of inflation, gained 0.3% m/m and 1.5% y/y. Driving the rise was a solid pick up in labour costs, with employment cost index increasing 0.7% q/q in Q4. Fed Chairman Powell noted at last week’s FOMC press conference that the Fed would look through an expected rise in inflation this year as transitory.

Today’s Economic Data and Events

  • Eurozone Manufacturing PMI (Jan) : 13:00 forecast 54.7
  • UK Manufacturing PMI (Jan): 13:30 forecast 52.9
  • US Manufacturing PMI (Jan): 18:45 forecast 59.1
  • US Construction spending (Dec): 19:00 forecast 0.8% m/m
  • ISM Manufacturing PMI (Jan) 19:00 forecast 60.0

Source: Bloomberg, Emirates NBD Research


Fixed Income

  • Benchmark US treasuries ended January mixed with the front end of the curve seeing yields hold steady at their low levels as policy rates stay anchored near 0 while yields on the back end of the curve moved higher in anticipation of better growth thanks to the rollout of Covid-19 vaccines and pending fiscal stimulus measures in the US.
  • Yields on the 2yr UST closed the month at 0.1093%, a drop of slightly more than 1bps on both the month and the week. The 10yr UST sank over the course of January with yields gaining 15bps to settle at 1.0655% although the move upward in yields has started to fade, with yields down by 2bps last week. This week the US Treasury will outline its borrowing schedule with expectation of lower volumes for the coming months.
  • Amid sharp sell-offs in equities most bond markets performed well last week with gains in both European and Asia-Pacific markets. High yield bonds fell in line with risk assets while emerging market debt showed limited change.
  • Central bank decisions this week come from Australia, Thailand, the UK, Egypt and India where no changes are expected in policy rates by any of them.


  • The US dollar index continues to trade in a narrow range between 90.1 - 90.9, ending the week 0.3% higher at 90.533, boosted by risk-off sentiment. The JPY closed at 104.71, its highest point since early November, marking a break beyond the 50-day (103.82) and 100-day (104.40) moving averages.
  • Despite wide intraday movement, currencies paired against the greenback finished largely flat on Friday. The GBP and NZD ended the week only slightly higher by 0.16% and 0.06% respectively, while the EUR fell by -0.29%. The AUD was amongst the biggest movers, falling by -0.92% to reach 0.7644.


  • Global equity indices endured a marked sell-off last week, with much of the losses coming on the Friday. Social-media driven retail investor buying frenzies for certain stock drove up volatility over the close of the week and prompted risk-off tone more widely.
  • Notwithstanding the spectacular rise of stocks targeted by message boards, all three benchmark US indices closed in the red with the S&P 500 and the Dow Jones closing down -3.3% w/w and the NASDAQ -3.5%. All three lost around -2.0% on Friday.
  • In the UK, the FTSE 100 lost -4.3% w/w, and is now also down -0.8% ytd. The index lost -1.8% on Friday, despite a sell-off in sterling. Elsewhere in Europe the CAC lost -2.9% w/w and the DAX -3.2%.
  • Asia was not immune from the global sell-off as the Shanghai Composite lost -3.4% w/w, the Hang Seng -4.0% the KOSPI -5.2% and the SENSEX -6.7%.


  • Oil prices have firmed up around their current levels in the last few weeks, showing modest w/w changes. Brent futures gained 0.9% to close out at 55.88/b while WTI fell by 0.27% to settle at USD 52.20/b.
  • For January as a whole, Brent prices averaged USD 55.32/b, down 13% y/y, while WTI recorded an average of USD 52.10/b, down by 9.4% y/y.
  • OPEC+ holds its joint ministerial marketing committee meeting this week to assess the current level of the market and how well producers are sticking to their targets.

Click here to download charts and tables


Written By

Daniel Richards Senior Economist

Edward Bell Head of Market Economics


Emirates NBD Research Research Analyst


Emirates NBD Research Research Analyst

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