Egyptian non-oil private sector rises to 49.2 in November: PMI

CAIRO – 6 December 2018: Egypt’s Emirates NBD Purchasing Managers’ Index (PMI) for the non-oil private sector rose to 49.2 in November, recording the highest reading in three months, compared to 48.6 in October.

Emirates NBD research clarified that despite reaching the highest rate in three months, “it is still in contraction territory.”

“The main components of the index – output, new work – declined less than in the prior two months,” it added.

The neutral level of Emirates NBD Purchasing Managers’ Index (PMI) is 50 which delineates contraction and expansion in the non-oil private sector.

According to the released data, new export orders also remained in contraction territory for the third month in a row, as the Egyptian pound has been resilient in front of the Euro since April, which may be contributing to the recent softness in export demand.

Firms surveyed cited "challenging economic conditions" which continued to weigh on demand as a reason for the decline in new orders last month, the data stated.

The research also referred to the decrease in the employment rate for the second month in a row during November, “with this component of the PMI falling to the lowest level since March.”

It also said that staff costs hiked at a similar rate to the previous three months as a result of the firms' response to higher living costs.

“Output prices were stable on average last month, with the output price index at the lowest level since November 2015,” it said.

AS per input prices, the rate of increase in producer prices was the weakest since the series began in April 2011, as inflationary pressures appear to have eased in recent months after spiking on subsidy cuts over the summer.

The survey, sponsored by Emirates NBD and produced by IHS Markit, contains data collected from a monthly survey on business conditions in the Egyptian private sector.

In September, Egypt’s Emirates NBD Purchasing Managers’ Index (PMI) for the non-oil private sector fell to 47.4, recording the lowest level since June, compared to 50.5 in August.