x Abu Dhabi, UAESunday 22 October 2017

Egypt's PMI rises in July by exports, bring a halt to 21 month decline in orders 

Companies surveyed expressed optimism that economy would improve over next year 

Firms in Egypt are optimistic with regards to output growth over the next 12 months. Mohamed Abd El Ghany/Reuters
Firms in Egypt are optimistic with regards to output growth over the next 12 months. Mohamed Abd El Ghany/Reuters

Non-oil private-sector growth in Egypt, north Africa's largest economy, rose in July, lifted by a rise in new export orders, according to the latest purchasing managers’ index produced by IHS Market.

While firms saw a sharp pick-up in input cost inflation, overall the survey showed increasing signs of stability in a country that has been through an elongated period of economic stress, as new orders stopped a 21-month decline.

The Egypt purchasing managers’ index (PMI) rose to 48.6 last month compared with 47.2 in June, said Emirates NBD, the sponsor.

“Egypt’s economy appears to be stabilizing, with new orders unchanged in July following nearly 2 years of contraction," said Khatija Haque, head of Middle East and North Africa research at Emirates NBD.

"However, firms saw input costs rise sharply on the back of higher fuel costs as subsidies were cut further at the end of June. Inflationary pressure is likely to remain elevated as higher electricity tariffs came into effect this month.”

Companies polled for the survey expressed optimism that economic conditions in the country would improve in the next 12 months and that the currency, which was devalued against the US dollar in November, would start to strengthen.