–  Egypt’s Purchasing Managers’ Index (PMI) reached a three-year high in June at 49.9, up from 49.6 in May, driven by increased sales volume and economic policies easing price pressures.

– While manufacturing and services sectors saw a rise in new orders, the construction, wholesale, and retail sectors faced declines, presenting a mixed market outlook.

–  June experienced the fastest increase in input prices in three months, with annual inflation reaching 27.1%. Employment in the non-oil sector remained stable, with some firms planning to hire more staff despite ongoing layoffs in other companies. 

 Egypt’s Purchasing Managers’ Index (PMI) reached its highest level in three years in June, climbing to 49.9 from 49.6 in May, according to an S&P Global Egypt PMI report.

The rise was attributed to an increase in sales volume for the first time since August 2021, alongside current economic policies aimed at alleviating price pressures and boosting demand.

Output levels experienced the mildest decline in nearly three years, while the volume of input purchases increased for the first time since December 2021. This indicates a cautious optimism among businesses about future prospects.

Non-oil firms saw a rise in new business intakes, with more companies reporting enhanced demand compared to those experiencing a decline. However, the market presented a mixed picture as the manufacturing and services sectors reported a hike in new orders, while the construction, wholesale, and retail sectors faced a downturn.

June saw the fastest increase in input prices over the past three months, driven by high market price volatility and accelerating inflation trends. The annual headline inflation rate soared to 27.1% in June, while the monthly headline inflation rate rose from -0.8% in May to 1.8% in June.

In response to increased total sales, non-oil firms plan to expand their capacity, although some companies boosted their output, the overall production increase was moderated by a decline in other companies. Employment in the non-oil sector remained stable, with some firms planning to hire more staff to meet rising sales, while others reported layoffs without replacements.

The survey data from June indicated a decrease in inflationary pressures on businesses in the second quarter of 2024. Despite this, rising material costs have increased expenses over the past three months. Input price inflation remained lower than at the start of the year during Egypt’s foreign currency crisis.

In March, the Central Bank of Egypt announced the flotation of the Egyptian pound and raised interest rates by six percent to address the foreign exchange shortage crisis.