Egypt’s Private Sector Downturn Softens in November –PMI
Private sector pressure softened in Egypt as a decline in activity eased sales with the slowest rise in charges since July, according to S&P purchasing manager index (PMI).
In November, Egypt PMI edged closer to 50% growth threshold, according to the latest report.
S&P said the latest business survey data signaled a further decline in operating conditions across the Egyptian non-oil sector in November.
Output levels fell in response to weaker order inflows, but the downturn softened to its least marked in three months.
Input prices rose at the slowest pace since July, despite some pressure on material costs from a stronger US dollar.
Output charges likewise rose to a more modest degree. Nevertheless, firms were less confident about future business activity in November, which contributed to a renewed drop in headcounts.
The PMI edged up for the second month running in November and moved closer to the 50.0 mark that separates growth from contraction.
“At 49.2, increasing from 49.0 in October, the index was indicative of a marginal decline in business conditions.
Non-oil private sector activity fell for the third month in a row, which survey panellists generally attributed to persistently weak customer demand.
New order volumes also decreased, following the trend since July. However, rates of contraction softened from the previous month, as some firms reported a pick-up in new work amid some signs of recovery.
Sector data revealed a hint of growth in the manufacturing industry, as goods orders rose modestly, driving an increase in output.
This helped offset further declines across construction, wholesale & retail and services. Employment numbers decreased in November, after a four month run of expansion.
The reduction in jobs was also the quickest since February, albeit marginal. Lower staffing levels were mostly linked to firms not replacing voluntary leavers amid reduced sales volumes and weaker confidence.
Indeed, output expectations for the year ahead were only just positive, representing the second-lowest degree of confidence in the series history.
Reduced output contributed to some excess stocks at companies, in turn leading to a further curtailment of input purchases.
A lack of pressure on vendors supported the first, albeit slight, shortening of delivery times in a year. Non-oil businesses also highlighted a softening of input cost inflation during November as the degree of price pressures slid to a four-month low.
This was mainly due to lower wage growth, with overall staff pay rising at the slowest rate in 16 months. Nevertheless, purchase prices continued to rise strongly, which survey evidence partly attributed to a strengthening of the US dollar.
Softer cost pressures led to a moderation of output price inflation. Selling charges increased modestly and to the least extent for four months.
There was even a slight drop in average output prices across the construction sector, contrasting with higher charges elsewhere.”. #Egypt’s Private Sector Downturn Softens in November –PMI Litigation Claims against Access Holdings Plc Hit N11.3Trn
