Egypt private sector PMI rises to 49.6 in August

The report showed broad-based improvement in output and new orders, even if both were still declining overall. Employment was a standout, with hiring registering one of the fastest increases in the survey’s 15-year history as firms added staff to cope with capacity pressures and stabilize backlogs.

That resilience came despite persistent headwinds. Purchasing activity fell for a fifth straight month and at the fastest pace in nearly three years, reflecting weak cash flow, delayed supplier payments, material shortages and trade disruption tied partly to the Strait of Hormuz. The report also said input and output price inflation accelerated for the first time in three months, with higher raw material, oil and transport costs feeding through while wage growth remained elevated.

For investors, the key takeaway is that Egypt’s private sector is showing more signs of bottoming out after a prolonged slump, which could support expectations for better third-quarter growth and a firmer outlook for consumer-facing, services and labor-linked businesses. Global P&S Intelligence said the PMI reading is consistent with annual GDP growth approaching 5%, though the index is still signaling that activity has not fully turned a corner.

Business confidence also improved to its highest level since June 2022, with firms citing projects, tourism and new branches as reasons for optimism. The next test is whether stronger hiring and improving orders can offset cost pressure and supply-chain strain without triggering a setback in demand.