Non-oil PMI hits three-year low as input costs spike to early-2023 highs

Egypt's non-oil private sector contracted at its fastest pace in over three years in April as the regional war drove input costs to their highest level since early 2023, according to S&P Global's latest PMI report (pdf). The headline reading fell 1.4 points to 46.6 — a fifth straight monthly decline and well below the 50.0 growth threshold, down from 48.0 in March.

Output, new orders, purchasing, and employment all weakened. Supplier delivery times lengthened for the first time this year on input shortages and shipping delays tied to the war.

After months of absorbing higher fuel and material costs, companies pushed selling prices up at their fastest pace since August 2024. Order books softened immediately in response, with manufacturing and wholesale/retail taking the heaviest hits.

Firms are pulling back on inputs and headcount. Job cuts were close to the survey's long-run average, but the direction is clear: caution on spending, caution on hiring.

Why it matters: The reading is consistent with annual GDP growth slowing to around 3.9%. S&P's David Owen warns the price acceleration suggests March's 15.2% headline inflation “may have further to run.”

What's next: Companies are hoping for the disruption from the Middle East conflict to ease and the market conditions to recover, but for now, the April reading shows the private sector starting 2Q with weaker demand, faster price increases, and a subdued outlook.