The index remained below the 50-point threshold that separates expansion from contraction, signaling a continued deterioration in business conditions at the start of the third quarter.
By: Business Today Staff
Tue, Aug. 4, 2026
Egypt’s non-oil private sector remained in contraction for the seventh consecutive month in July 2026, despite an improvement in the Purchasing Managers’ Index (PMI) to 46.8 from 46.0 in June, according to the latest S&P Global report.
The index remained below the 50-point threshold that separates expansion from contraction, signaling a continued deterioration in business conditions at the start of the third quarter. The survey’s preliminary estimates also pointed to annual GDP growth of around 4%.
New orders declined for the seventh straight month, weighed down by subdued market conditions, pricing pressures, delays in maritime shipping, and a shortage of new projects. Weak demand prompted companies to cut output, employment, and purchasing activity.
Although the pace of decline in business activity eased to its slowest level in four months, job cuts moderated to only a marginal rate. Meanwhile, outstanding business increased at the second-fastest pace in nearly three years, placing additional pressure on labor capacity, raw materials, and production at some firms.
Purchasing activity recorded its sharpest decline since September 2023, with nearly one-third of surveyed companies reducing their input purchases. Pre-production inventories also fell for the first time in five months.
On the supply side, delivery conditions improved slightly, as supplier delivery times shortened for the first time since March, reflecting an easing of disruptions to domestic supply routes caused by the conflict in the Middle East.
Cost pressures continued to soften, with input costs rising at their slowest pace in six months. Lower oil prices and a weaker U.S. dollar also helped ease inflation in purchase prices.
Despite the challenging business environment, companies grew more optimistic about the year ahead. The Future Output Index climbed to its highest level since June 2022, supported by expectations of stronger customer demand, although concerns remain over the potential impact of regional developments on business confidence and pricing.