CAIRO: Egypt’s private sector activity kicked off the new fiscal year with an expansion, driven by an uptick in demand that offered additional evidence of an economic rebound.
Non-oil business activity reached an eight-month high in July, the Emirates NBD Purchasing Managers’ Index (PMI) for the whole economy showed. The index climbed to 50.3 from 49.4 in June, with readings above 50 signalling an expansion.
The expansion was mainly a result of a rise in new orders to the highest level since November 2017, Emirates NBD said in a statement. That increase suggested that consumers were starting to flex some purchasing muscle now that the surge in inflation after the floating of the Egyptian pound in 2016 has abated. Annual inflation in July came in at 13.5%, down from 14.4% the previous month and more than 30% for much of last year.
“The positive PMI reading for the first month of the new fiscal year supports our view that real GDP growth will strengthen in 2018/19 as there is a greater recovery in the private sector, supported by gradual monetary policy normalisation, improved political stability and a rebound in the tourism sector,” Daniel Richards, MENA Economist at Emirates NBD, said in the statement. — Bloomberg
Did you find this article insightful?