Cairo – Mubasher: Egypt’s non-oil private sector activity witnessed a softer downturn in May than in April.
The seasonally adjusted IHS Markit Egypt Purchasing Managers’ Index rose to 40.7 in May, compared to a record low of 29.7 in April, according to a report on Wednesday. A reading above 50 indicates expansion, while a reading below that signals contraction.
This marked the second-fastest pace and a 10-month declining streak.
Further employment and salary cuts have led to the first reduction in cost pressures since the series began in 2011.
"The Egypt PMI rose 11 points to 40.7 in May which, while signalling that the worst of the economic hit from the COVID-19 crisis may have passed, still pointed to weaker business conditions since April,” David Owen, an economist at IHS Markit, said.
"Output and new orders fell again as private sector demand remained broadly stagnant. Export sales were also weak. In addition, job losses accelerated to the quickest pace in over three years,” Owen noted.
The outlook for activity over the coming 12 months worsened from April, but it was still higher than March's low.
"Sentiment was still positive, though concerns arose that the US/China relationship is worsening, which could affect any rebound in global demand," he pointed out.
