Cairo - October 5, 2025 – Egypt’s non-oil private sector saw further deterioration in business conditions in September, as revealed by the latest S&P Global Egypt Purchasing Managers’ Index (PMI).
The headline PMI dropped to 48.8, down from 49.2 in August, marking its weakest performance in three months. Remaining below the neutral 50.0 mark for the seventh month in a row, the reading signals a continued contraction in the sector.
Driving the downturn were sharper declines in both new orders and output. The report also highlighted a halt in employment growth and a decline in business confidence, adding to the overall subdued outlook for the private sector.
While the overall decline in operating conditions remained modest, the pace of contraction accelerated.
Firms reported steeper reductions in both output and new sales, with the latter falling at the fastest rate since April. Surveyed businesses cited sluggish economic conditions, price pressures, and rising wage costs as key factors behind the drop in demand.
“Businesses saw further declines in activity and new orders at the end of the third quarter,” the report noted. “In both cases, rates of decrease quickened, with order book inflows falling to the greatest extent since April.”
In response to lower demand, companies continued to scale back activity for a seventh straight month. The contraction in output was the most pronounced since June, although still softer than the long-run series average. Wholesale and retail sectors were hit hardest, registering the steepest drops in output, sales, and purchasing activity.
Employment growth came to a standstill in September after two months of job creation. The majority of firms reported no changes to staffing levels, pointing to reduced workloads and limited new business as the main reasons.
“Nearly all monitored firms registered no change in their workforces in September, ending a two-month run of job creation,” the report stated.
Business confidence also took a hit, falling to one of its lowest levels in the history of the survey, reflecting broader concerns about the economic outlook.
September saw the slowest increase in input costs in six months, supported in part by a stronger exchange rate against the US dollar, which helped temper import prices. However, wage-related expenses continued to rise, with total staff costs increasing at the fastest rate since May 2024.
“Some firms opted to keep more inputs in reserve, which led to the first rise in stocks of purchased items since May,” the survey said.
Meanwhile, output prices climbed for the fifth month in a row. Although the rate of inflation eased slightly from August, businesses still raised selling prices in an effort to pass on higher costs to customers.
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