Egypt Non-Oil Private Sector Downturn Eases

The S&P Global Egypt PMI rose to 46.8 in July 2026 from 46.0 in June, signaling a softer but still sharp contraction in the non-oil private sector. New orders fell for a seventh straight month amid weak demand, high prices, shipping delays, and fewer new projects, leading to a softer decline in output. Employment continued to fall, while backlogs of work rose at the second-fastest rate in nearly three years. Purchasing activity contracted at the sharpest pace since September 2023, prompting the first decline in input inventories in five months. In contrast, supply chain conditions improved for the first time since March as delivery times shortened amid easing Middle East disruptions. Input cost inflation also eased to a six-month low, while output price inflation slowed to a four-month low. Looking ahead, business confidence hit its highest level since June 2022, although optimism remained tied to regional geopolitical developments.

The S&P Global Egypt PMI fell to 46.0 in June 2026 from 47.1 in May, signaling the sharpest contraction in the non-oil private sector in nearly three and a half years. Business conditions weakened as new orders fell at the fastest pace since November 2022, pressured by weak liquidity, supply disruptions, raw material shortages, and the Middle East conflict. Output, purchasing activity, and employment all contracted, although job losses eased slightly from May. Supply chain pressures remained elevated, with delivery times lengthening further due to shipping disruptions in the Strait of Hormuz, raw material shortages, and higher fuel costs. Meanwhile, input cost and output price inflation moderated from May's near-record highs, though fuel, raw material, and wage pressures remained significant. Looking ahead, business confidence stayed positive despite easing slightly from May, supported by expectations of reduced geopolitical disruptions and stronger government support.

The S&P Global Egypt PMI rose to 47.1 in May 2026 from 46.6 in April, signalling a slower deterioration in non-oil private sector conditions. Manufacturing and construction returned to growth, while inventories rose at the fastest pace in nearly three years. Despite these improvements, inflationary pressures intensified, with input costs rising at the fastest pace since January 2023 due to higher fuel and electricity prices, currency weakness, and stronger wage pressures. Supply chain conditions also worsened, with delivery times lengthening at the fastest pace in nearly four years amid shipping disruptions and Middle East tensions. Firms responded by cutting jobs at the fastest rate since June 2020 as weak demand and rising costs weighed on activity. Looking ahead, business confidence improved to its highest level since August 2024 on hopes of improved economic conditions and exchange rate stability, despite persistent inflation concerns.