Cairo – Mubasher: Sales volumes at Egyptian non-oil companies increased for the first time in nearly 34 months in June 2024, ending declines since August 2021.
The uplift followed signs of stabilising economic conditions as policy supported easing price pressures and improved demand prospects, according to a report by S&P Global.
The headline seasonally adjusted S&P Global Egypt Purchasing Managers’ Index ticked up to 49.90 in June 2024, the highest reading in three years, from 49.60 in May, barely below 50, the divide between growth and contraction.
Output declines slowed sharply to the softest in nearly three years, while input purchases rose for the first time since December 2021.
Input costs accelerated, but inflation remained soft versus earlier this year ahead of the devaluation of the pound, while selling prices posted a modest uptick, faster in three months.
New orders increased for the first time since August 2021 on gains at manufacturing and services firms. However, construction and wholesale and retail saw declines, painting a mixed picture.
Surveyed firms cited improving domestic and export demand, with the latter growing at the sharpest pace in two-and-a-half years.
With sales rising, non-oil companies boosted capacity and input purchases. While output fell at the slowest rate in nearly three years, but employment was relatively stable amid layoffs.
Confidence dipped to the lowest on record amid uncertainty following financial volatility, capping expansions.
David Owen, Senior Economist at S&P Global Market Intelligence, said: "With the headline PMI reaching 49.90 and total new order volumes rising for the first time in nearly three years, businesses appear to be heading on the road to recovery.”
"Although output levels continued to fall on average, they were also close to growth territory, as business capacity was helped by a fresh increase in the buying of inputs,” Owen added.
The economist noted: "While June saw the fastest rise in input prices for three months, firms generally commented that this was due to a high degree of volatility in market prices rather than an accelerating inflation trend.”
