Egypt’s PMI down to 49.2 in August amid weak demand

Updated 9/3/2025 7:48:00 AM

Arab Finance: Egypt’s headline seasonally adjusted Purchasing Managers’ Index (PMI) dropped to 49.2 in August 2025 from 49.5 during July, according to the latest S&P Global PMI data.

Nonetheless, the rate of contraction was relatively soft compared to historical trends, less sharp than the average observed over the survey's history (48.2).

The reading highlighted another dip in business conditions in the non-oil private sector during August, with companies reducing their output amid weak demand for the sixth consecutive month.

Lower demands were attributed to weak economic conditions and concerns over persistent inflation.

This decrease in purchasing led to shorter average delivery times for the first time since March.

On the other hand, employment expanded for the second month running in August, following the first expansion in nine months during July.

Businesses increased staffing levels to boost capacity and support backlog completion. However, the overall rise in workforce numbers remained marginal.

As for the pricing aspect, the survey highlighted a notable easing of input cost pressures, with overall operating expenses rising at their slowest pace since March. This marked one of the least pronounced rises in the past four-and-a-half years.

Prices charged by non-oil firms surged at their fastest rate since May, reducing the gap between input and output price inflation to its smallest in five months.

Meanwhile, Egyptian non-oil firms’ optimism was unchanged from July, only marginally higher than June's record low.

David Owen, Senior Economist at S&P Global Market Intelligence, said: "Persistent inflationary pressures appear to be a key factor holding back company sales and output projections over recent months. While official CPI inflation has fallen from 2024 levels, it was still at a marked rate of 13.9% in July.”

“However, the latest PMI data signalled that business cost pressures were at one of their lowest levels since early-2021. If this can be sustained and passed onto customers in the form of lower prices, firms could see client appetite stage a recovery,” he added.