The private non-oil sector of the United Arab Emirates grew in June, driven by a sharp rise in new orders and output, while employment stagnated and new export orders fell for the first time in seven months, a result of lower business optimism and reduced demand from the international markets, a new survey released on Tuesday showed. The UAE Purchasing Managers’ Index (PMI), which is compiled by Emirates NBD, Dubai’s largest bank, reported a score of 55.8 in June, up from 54.3 in May. A figure of less than 50 indicate the market is declining while above 50 forecasts growth. May witnessed the weakest improvement in six months, according to the report. However, for the third consecutive month in a row companies have continued to offer discounted selling prices in an attempt to boost growth. The employment index in June declined slightly to 50.4 from 50.7 in May, an indication that firms are reluctant to increase their hiring in an environment where margins continue to be squeezed, according to the Emirates NBD report. “While businesses are optimistic about the coming year, the business optimism index fell to 56.5 in June, the second-lowest level on record,” the report said. It said a decision by OPEC’s oil production to extend oil cuts- to boost the oil market - through the second half of 2017 and the first quarter of 2018 has led the bank to downgrade its forecast for the UAE’s real GDP growth to 2 percent this year, down from 3 percent in 2016. On the other hand, the Saudi Arabian non-oil private sector declined to 54.3 in June, the lowest reading since October last year. The slowdown came as a result of input price inflation that was not fully passed to consumers. Some firms were forced to cut their selling prices due to competitive pressures. Business optimism was also week in the kingdom. PMI was broadly unchanged in Egypt remaining at 47.2 in June, the report said. The Arab world’s most populous nation is going through a tough economic period at present. Inflation hit a 30-year high in April, soaring since November’s flotation of the Egyptian pound slashed the currency’s value by about half versus the dollar. In May, the government announced it would allocate an extra 1 billion Egyptian pounds ($55 million) in food subsidies during the high-demand season of Ramadan.