Egypt non-oil activity shrinks in November as confidence hits record low

Credit: REUTERS/AMR ABDALLAH DALSH

CAIRO, Dec 5 (Reuters) - Egypt's non-oil private sector contracted for a 36th straight month in November and business confidence dropped to its lowest in at least 11 years as record inflation took its toll, a survey showed on Tuesday.

The S&P Global Purchasing Managers' Index (PMI) for Egypt improved to 48.4 from 47.9 in October, yet remained below the 50.0 threshold that marks growth in activity.

"With demand conditions continuing to worsen amid inflationary pressures, non-oil firms in Egypt posted their lowest level of confidence in future activity in the series history," S&P Global said. The Egypt PMI's business confidence sub-index was launched in 2012.

Egypt's annual inflation rate slowed to 35.5% in October but remained near the country's all-time high of 38.0% a month earlier, according to the state statistics agency CAPMAS.

Business sentiment was dampened by a sharp increase in input costs, with firms complaining of currency weakness and supplier shortages, S&P added.

"The data showed that expectations were only slightly positive, while the manufacturing and construction sectors slipped into pessimism territory," it said.

Despite the higher prices, the sub-index for new orders climbed to 47.3 from 47.1 in October, and the output sub-index rose to 47.2 from 46.4. The backlog index likewise edged up to 51.1 from 50.6.

(Reporting by Patrick Werr; Editing by Susan Fenton)

((patrick.werr@thomsonreuters.com;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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