Egypt: PMI in September in expansionary territory for first time since July 2019
Egypt’s Purchasing Managers’ Index (PMI)—which measures business activity in the non-oil private sector—rose to 50.4 in September from 49.4 in August. The figure marked the first expansionary reading in 14 months, 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 a third successive rise in new business, with the rate of sales growth accelerating at the fastest pace in over five years as consumer demand notably improved. Furthermore, the decline in employment also softened in September, although this nonetheless represented the 11th straight month of weakening employment figures.
On the price front, input costs continued to increase in September but at a softer pace, in part due to a stronger Egyptian pound. Consequently, output prices also rose.
Regarding this month’s print, David Owen, economist at IHS Markit, commented:
“The latest Egypt PMI data offered more optimism for businesses, as the September PMI indicated an improvement in economic conditions for the first time in 14 months. […] This suggests the non-oil economy is seeing a modest turnaround after the devastating impact of the COVID-19 pandemic. Both the Output and New Orders series have been in expansion territory for three months, pointing to a more upbeat picture for the third quarter of 2020.”