Egypt’s non-oil private sector sees continued growth in February: PMI

Updated 3/4/2025 7:49:00 AM

Arab Finance: Egypt's non-oil private sector continued to improve in February, maintaining the positive trend seen at the start of 2025, according to the latest S&P Global Egypt Purchasing Managers’ Index (PMI) survey data.

Businesses reported stronger client demand, marking the first consecutive monthly improvement in over four years.

The headline PMI retreated from 50.7 in January 2025 to 50.1 in February. Despite this decline, the index remained above the neutral 50.0 mark, signaling ongoing recovery, which is the first since late 2020 that the sector has shown back-to-back monthly growth.

Order book volumes increased for a second consecutive month, deriving a solid rise in purchasing among non-oil businesses. However, output remained stable and job numbers dropped.

Meanwhile, the higher demand prompted firms to raise their purchases for the third month in a row, with the latest upturn representing the sharpest hike recorded in three and a half years.

Businesses exerted efforts to secure new inputs as market conditions improved, but they faced challenges in retaining staff and hiring new workers. This resulted in an overall drop in employment for the third time in four months.

Additionally, the input cost pressures across the non-oil sector remained relatively soft compared to 2024's trends.

Higher material prices driven by a strong US dollar reportedly led to a slight acceleration in purchase price inflation, which was partly offset by decreased staff costs.

David Owen, Senior Economist at S&P Global Market Intelligence, said: "Coupled with January's upturn, the data reflects the best opening two months of the year in the survey's history.”

Owen elaborated: "Stronger customer spending seems to have revitalized markets, driving higher sales volumes and supporting improved operating conditions. This positive momentum has led to increased spending among firms.”

“Additionally, price pressures are relatively low compared to those experienced in 2024, indicating that inflation is likely to continue its downward trend, in the near-term at least,” the economist highlighted.

He concluded: "On the other hand, the employment market remains mixed at best, and the manufacturing sector is struggling to secure new orders. Economic and geopolitical risks continue to loom large, contributing to another month of subdued expectations for the year ahead."