Egypt non-oil business activity contracts for 21st month in June

Egyptian non-oil private-sector business activity contracted for the 21st consecutive month during June as output and new orders continued to fall, a survey showed Tuesday.

The Emirates NBD Egypt Purchasing Managers’ Index (PMI) for the non-oil private sector dipped to 47.2 points in June from 47.3 points the previous month, the report showed, remaining below the 50 mark that separates growth from contraction.

Egypt’s economy has been struggling since a 2011 uprising, but the government hopes recent reforms that are part of a $12 billion International Monetary Fund programme signed last year

will help put the country on the right track.

Output continued to decline for the 21st month in a row, falling to 45.3 points in June from 46 points a month earlier as demand remained low. New orders also fell, but at a slower pace.

New export orders continued to rise for the third month in a row, the survey showed, suggesting demand has grown since the central bank’s decision to float the currency in November, as

part of the IMF deal.

The value of Egypt’s pound has fallen by half since the flotation, helping Egyptian exports find new international markets.

“While the Egyptian economy remains under pressure, there are further signs of stabilization as export orders rose for the third straight month in June,” said Khatija Haque, head of MENA

Research at Emirates NBD.

“However, firms continued to cite weak domestic demand conditions as weighing on activity and new order growth.”

Source: Reuters