Cairo – Mubasher: Egypt’s headline seasonally adjusted Purchasing Managers’ Index (PMI) fell from 49.2 in November 2024 to 48.1 last December, marking a decline in the non-oil private sector for the fourth month running.
The rate of deterioration was modest but the strongest since April 2024, according to the latest S&P Global PMI data.
The reading highlighted that rising price pressures as well as a weakening exchange rate to the US dollar led firms to take on a greater share of their cost burden. Nonetheless, future confidence in output strengthened.
Output and new orders at non-oil companies fell at sharpest rates in eight months, the PMI data showed.
Material costs hiked in December, driving the quickest rate of input price inflation in three months.
With firms struggling to achieve growth of sales, output prices recorded a rise to the least extent since last May.
David Owen, Senior Economist at S&P Global Market Intelligence, said: "The latest Egypt PMI data showed that the non-oil private sector's anticipated recovery is unlikely to be without its setbacks in 2025.”
“With the Egyptian pound deteriorating against the US dollar, breaching the 50-per-dollar mark in early December, businesses reported higher prices and a slump in demand, leading to the fastest decline in operating conditions since last April,” Owen added.
He indicated: "The downturn meant that firms were less keen to raise their own charges in the face of accelerating cost burdens, instead tightening their margins in a bid to salvage orders.”
“ While this supported a pick-up in optimism towards future business activity, others suggested that exchange rate movements could be a decisive factor in how output and profits fare in the coming months,” the economist concluded.
