CAIRO, Aug 5 – Egypt’s non-oil private sector remained in contraction for the seventh consecutive month in July, although business conditions showed a slight improvement, according to the latest Purchasing Managers’ Index (PMI) from S&P Global.
The headline PMI rose to 46.8 in July from 46.0 in June. However, it remained below the 50-point mark, showing that business activity continued to weaken at the start of the third quarter. The survey also pointed to annual GDP growth of about 4%.
New business fell for the seventh month in a row as companies continued to face weak demand, higher prices, shipping delays and a limited flow of new projects. As a result, many businesses reduced output, cut jobs and scaled back purchasing.
Even so, the pace of decline in production eased to its slowest level in four months, while job cuts became less severe. At the same time, backlogs of work rose at the second-fastest pace in almost three years, putting more pressure on staff, raw materials and production.
Purchasing activity recorded its sharpest decline since September 2023, with nearly one-third of surveyed firms buying fewer inputs. Stocks of pre-production materials also fell for the first time in five months.
Meanwhile, supply conditions improved as supplier delivery times shortened for the first time since March. S&P Global linked the improvement to fewer disruptions on domestic supply routes amid the conflict in the Middle East.
Input cost inflation also slowed to its weakest pace in six months, helped by lower oil prices and a weaker U.S. dollar.
Despite the ongoing challenges, business confidence strengthened. The Future Output Index reached its highest level since June 2022, as companies expected customer demand to improve over the next year. However, many businesses remained concerned about the possible impact of regional developments on prices and overall market conditions.
