Egypt: Non-oil private sector PMI increases in September but remains in contractionary territory
The Purchasing Managers’ Index (PMI), which measures business activity in the non-oil private sector, rose slightly to 49.5 in September from 49.4 in August. Nevertheless, the PMI remained below the 50-threshold that separates contraction from expansion for the second month in a row.
Output decreased in September, but at a slightly slower pace than in August. Still, this led to another rise in input inventories in September, which meant businesses kept purchasing activity largely unchanged. Meanwhile, new business orders decreased for the second consecutive month in September and at a faster pace than in August, largely due to fewer new orders from the domestic market. In terms of the labor market, and despite the challenging demand panorama, employment growth accelerated to the fastest rate in 13 months in September. Looking at prices, both input and output price inflation slowed in September, partly as a stronger Egyptian pound against the U.S. dollar helped weigh on input prices. Going forward, businesses grew less confident about the operating outlook in September, with confidence falling to the lowest level since October 2016.