Dubai tourist numbers exceed pre-pandemic levels in H1 2023

Dubai saw 8.55mn international visitors in H1 2023, up 20% over H1 2022. The figures show that Dubai’s tourism sector has fully recovered from the pandemic, with the number of visitors up 2.3% on H1 2019. 20% of visitors came from Western Europe, followed by South Asia (17% of the total) and then the GCC. Hotel occupancy in Dubai averaged 78% in H1 2023, up from 73.5% last year and also above pre-pandemic levels according to STR. Revenue per available room averaged USD 146 in January through June, similar to H1 2022, and 20% above H1 2019.

Germany’s industrial production declined by a worse than expected -1.5% m/m (-1.7% y/y) in June. The decline in output was evident in autos & parts, metals and engineering. The index fell to its lowest level since December 2022.

In Turkey, President Erdogan pledged to bring inflation down to single digit levels, after a cabinet meeting in Ankara yesterday. Inflation rose to 47.8% y/y in July, and while the central bank has raised the benchmark rate since the election, real rates remain deeply negative. 

Today’s Economic Data and Events

10:00 Germany CPI (July, final) forecast 6.2% y/y

16:30 US trade balance (Jun) forecast -USD 65.0bn

Fixed Income

• US Treasuries ended the day mixed with the front end of the curve closing near unchanged while the longer-end cheapened. Yield on the 2yr UST settled at 4.7619% while the 10yr UST yield added 5bps to 4.0885%. European benchmark bonds also ended the day cheaper with gilt yields up 8bps at 4.454% and bund yields adding 4bps to 2.596%.
• Emerging market bonds traded with a weaker tone to start the week with a broad USD index down marginally.

FX

• Currency markets started the week on a relatively quiet footing. EURUSD closed near unchanged at 1.1002 while GBPUSD showed more vigrour, rising by 0.3% to 1.2784. USDJPY added 0.5% to 142.50, snapping several days of gains for JPY.
• Commodity currencies had a more positive, though muted day. USDCAD closed down 0.1% at 1.337 while AUDUSD settled with an upward bias at 0.6573 and NZDUSD added 0.2% to 0.6106.

Equities

• US equity markets started the week on a positive footing with the Dow Jones up 1.2% and the S&P 500 rising 0.9%. The tech-oriented NASDAQ recorded gains of 0.6%. European equities closed higher by 0.1% while the FTSE dipped marginally.
• Asian equity markets are trading mixed mid-way through their day with the Nikkei up 0.1% while the Hang Seng is off by almost 1.8%.
• Locally the DFM was marginally lower while the ADX added almost 0.5%. The Tadawul traded heavier, down 0.7%.

Commodities

• Oil prices closed lower at the start of the week with Brent futures down 1% to USD 85.34/b and WTI off by a bit more to USD 81.94/b. There was no material catalyst for the move and both contracts are treading water in early trade today.