Cityscape in Egypt

Egypt PMI May 2024

Egypt: PMI rises in May

The S&P Global Egypt Purchasing Managers’ Index (PMI) rose to 49.6 in May from 47.4 in April, hitting a near three-year high. As a result, the index moved closer to the 50.0 no-change threshold—below which it has languished since December 2020—signaling a softer deterioration in non-oil private-sector operating conditions compared to the previous month.

The notable improvement was attributed to March’s policy measures enhancing currency availability, which lead to greater price stability and stronger business confidence in turn; the marked cooling of inflationary pressures and a near-stabilization in demand conditions led to the smallest decline in business activity in nearly a year. Moreover, employment grew as firms anticipated sales improvements. Additionally, new business fell at a softer pace and export orders increased amid improved foreign demand.

Regarding prices, May witnessed a significant easing in input cost inflation, falling to its lowest since March 2021, largely due to lower market exchange rates. This deceleration in cost pressures allowed companies to maintain the mild pace of price rises seen in April. Lastly, business optimism also saw an uptick thanks to the overall slowing in the rise of cost burdens contributing to a more favorable business environment.

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