Cairo – Mubasher: The Egyptian non-oil private sector activity shrank for the seventh month in a row in February as output, new orders, and employment continued their downward trend, according to a report released on Tuesday.
The headline seasonally adjusted IHS Markit Egypt Purchasing Managers’ Index (PMI) for the non-oil private sector registered 47.1 last month, compared to 46 a month earlier. A reading above 50 indicates expansion, while a reading below that signals contraction.
“Though the PMI improved from January's near three-year low, the latest data continue to show broad-based weakness across output, new orders and employment,” IHS Markit’s principal economist, Phil Smith, said.
Lower demand together with subdued cost pressures enabled non-oil firms to offer further discounts but at a lower rate of decline for the third consecutive month.
Moreover, the drop in demand and output requirements led non-oil firms to scale back employment.
"Unfortunately for local businesses, the challenging domestic market conditions are being compounded by weakness in external demand, with export orders continuing to fall sharply in February,” Smith noted.
"The outbreak of the coronavirus in China is not only reportedly weighing on export sales, but also dampening business confidence," he pointed out.
However, business outlook for the coming 12 months remained positive, but weakened for the second successive month to the lowest level since September 2019.
