Egypt: Non-oil private sector operating conditions worsen significantly in March
Egypt’s Purchasing Managers’ Index (PMI), which measures business activity in the non-oil private sector, fell in March at the fastest pace in over three years. The reading fell to 44.2 in March, down from 47.1 in February and indicating a more severe deterioration in business conditions—readings below 50 indicate an overall decrease compared to the previous month, and above 50 an overall increase.
The gloomy result in March was driven by stronger drops in new sales and output. Demand was notably affected by the coronavirus pandemic and measures taken to contain it, such as flight restrictions hitting the tourism sector. Moreover, reduced factory activity in China constrained the supply of inputs. Export volumes, for their part, decreased at the fastest pace in over seven years. Stock levels among businesses also dropped in March, and employment fell for the fifth consecutive month. In terms of prices, input cost pressure rose marginally, although output charges were lowered. Looking ahead, business confidence about future output prospects worsened to the lowest level on record.