Egypt: PMI improves marginally in April; conditions continue to sharply deteriorate
The S&P Global Purchasing Managers’ Index (PMI)—which measures business activity in the non-oil private sector—came in at 46.9 in April, up marginally from March’s 21-month low of 46.5. As a result, the index moved closer to, but remained below the 50.0 no-change threshold—where it has remained for the past 17 months—signaling a continued deterioration in business conditions from the previous month.
The continued buildup of price pressures, which are denting on consumers’ purchasing power, led to yet another decline in demand and new orders in turn. Raw material scarcity and high energy prices—partly due to the war in Ukraine—coupled with the recent Central Bank move, which allowed the pound to depreciate led to high inflation, weighing on output. In a bid to try to cut down costs, employment levels decreased once again in April, with jobs being shed at the quickest pace in one year. More positively, business sentiment improved from March’s survey record low, although it still remained downbeat due to expectations of elevated price pressures, supply disruptions and geopolitical tensions ahead.