Egypt’s non-oil private sector PMI remains in decline for October

Updated 11/5/2024 7:24:00 AM

Arab Finance: Egypt's non-oil private sector continued to see declining business activity in October, according to the latest S&P Global Egypt PMI® survey data.

The headline Purchasing Managers’ Index (PMI) rose slightly to 49.0 from 48.8 in September, remaining below the neutral 50.0 threshold for the second month in a row. This score indicates a general decline in business conditions.

Strong cost pressures led to higher selling prices across firms, which weighed on new orders.

Although the rate of input cost inflation slowed compared to September’s six-month high, firms still faced mild pressure on sales and staff costs.

Moreover, the survey showed that the downturn affected a broad range of sectors last October, with the construction industry seeing the sharpest drops in activity and sales.

Average prices charged by non-oil firms notably grew in October, marking the third consecutive month of fast-paced increase. This rise was mainly driven by higher input costs, such as raw materials and utilities, which were impacted by the high value of the US dollar, raising import costs.

Despite the decrease in activity, firms expanded their staffing for the fourth month straight, with October seeing the fastest hiring pace since May.

Businesses also increased inventory levels as a precaution against future cost pressures, though total input purchases fell for the first time in three months, easing some supply chain pressure.

Supplier delivery times were slightly longer for the third consecutive month but improved overall.

In October, non-oil companies expect business activity to rise in the next 12 months, though confidence remains low.