Egypt: PMI hits over five-year high in October
Egypt’s Purchasing Managers’ Index (PMI)—which measures business activity in the non-oil private sector—increased to 51.4 in October from 50.4 in September. The figure marked the second consecutive expansionary reading, with readings above 50 indicating an overall increase in operating conditions compared to the previous month.
The uptick in the PMI was predominantly driven by growth in output and new orders amid a strong rise in client demand, with the rate of sales growth accelerating at the fastest pace in over six years. Furthermore, firms noted they were able to expand capacity following the easing of restrictions since March’s clampdown. However, employment levels fell for the 12th straight month, with the pace of decline quickening from the prior month.
On the price front, input costs rose at the fastest rate in 13 months with output prices ticking up as a response.
Regarding this month’s print, David Owen, economist at IHS Markit, commented:
“A PMI reading of 51.4 in October signaled that the Egyptian non-oil private sector expanded at the quickest rate in nearly six years. The relatively strong upturn will encourage businesses, but also highlights the extent of the gap between current and pre-COVID activity levels that firms still need to abridge. Growth could accelerate further if restrictions remain loose, although there are still enduring risks that may slow the recovery.”