Egyptian non-oil sector sees 1st sales growth in nearly 3 years

Updated 7/4/2024 8:04:00 AM

Arab Finance: Egyptian non-oil companies have reported a notable increase in sales volumes during June, the first growth reported since August 2021, as indicated by the latest S&P Global Egypt PMI® survey.

The seasonally adjusted S&P Global Egypt Purchasing Managers’ Index™ (PMI) rose from 49.6 in May to 49.9 in June, remaining just below the 50.0 mark that separates growth from contraction.

This development follows recent signs of economic stabilization, supported by policy adjustments aimed at easing price pressures and enhancing demand prospects.

In June, output levels declined at the slowest rate in nearly three years, accompanied by a rise in input purchases for the first time since December 2021.

Despite a slight acceleration in input cost inflation to a three-month high, this did not hinder a modest increase in selling charges.

June also saw a resurgence in new business intakes at non-oil firms, marking the first growth since August 2021.

This increase was driven by improvements in domestic and international markets, with significant rises reported in new export orders, the strongest in two-and-a-half years.

With overall sales on the rise, non-oil companies have begun expanding their capacity, reflected in increased input purchases for the first time in months.

Some firms have increased activity, although this has been counterbalanced by declines elsewhere.

Nevertheless, the rate of output contraction slowed for the fourth consecutive month, marking the softest decline in nearly three years.

Employment levels in the Egyptian non-oil sector remained relatively stable in June, with some firms hiring in response to increased sales, while others reported layoffs and non-replacement of leavers.

However, overall confidence in future business activity slightly dipped to its lowest level on record.