Egypt: PMI increases in February, but remains in contractionary territory
The IHS Markit Purchasing Managers’ Index (PMI)—which measures business activity in the non-oil private sector—rose to 48.1 in February from January’s 47.9 reading. As such, the index moved closer to, but remained below the 50-threshold—where it has been for the past 15 months —signaling a softer deterioration in business conditions compared to the previous month.
January’s deterioration was largely due to falling output and new orders, as the recent increase in price pressures dragged on domestic demand. More positively, foreign new orders expanded for the first time in four months. Meanwhile, employment levels decreased in February for the fourth month running, while inventories dropped slightly and supply chain performance deteriorated.
Turning to prices, input costs increased at a softer pace in February, leading to a more moderate increase in output charges. Lastly, firms’ sentiment fell to the lowest level recorded in the survey’s history, weighed on by concerns about economic conditions and the potential impact of higher price pressures.