By Ukumbi Afrika 
Thursday, 3 September 2026
Cairo—Egypt’s non-oil private sector contracted at its slowest pace since January in August, as declines in output and new orders eased while businesses increased hiring, according to the latest S& P Global Egypt Purchasing Managers’ Index (PMI).
The seasonally adjusted PMI climbed to 49.6 in August, up sharply from 46.8 in July, marking its highest reading in seven months. A reading below 50 indicates contraction, while a reading above 50 signals expansion.
S& P Global economist David Owen said the survey showed growing signs of recovery across Egypt’s non-oil economy.
“The Egypt PMI demonstrated increased signs of economic recovery across the non-oil sector in August, with the headline index rising nearly three points on the month, ” Owen said.
Output and New Orders Improve
Output declined at its slowest pace in seven months, while new business remained in contraction but fell at its weakest rate since February.
Export sales also declined, extending the sector’s downturn to six consecutive months, although the rate of decline eased compared with July.
The employment picture provided a stronger signal of improvement. Non-oil companies increased staffing for the first time since October 2025, with the pace of job creation the second-fastest recorded since the survey began in 2011.
Meanwhile, backlogs of work were broadly stable after increasing during each of the previous three months.
Material Shortages and Cash-Flow Pressures
Despite signs of improving demand, businesses continued to face operational constraints.
Purchasing activity contracted for a fifth consecutive month, reaching its fastest rate of decline in almost three years. Companies cited material shortages and cash-flow constraints as key factors limiting purchasing.
Supplier delivery times also deteriorated modestly following a brief improvement in July.
Price Pressures Return
Cost pressures strengthened during August, with both input costs and output charges increasing at faster rates.
The acceleration marked the first increase in price pressures since May, potentially complicating the outlook for businesses and policymakers as Egypt seeks to strengthen economic activity while managing inflationary pressures.
Business Confidence Strengthens
Business sentiment nevertheless improved for the fourth time in five months, reaching its highest level since June 2022.
Companies attributed the stronger outlook to expectations surrounding new projects, tourism activity and branch openings, suggesting that businesses are becoming more optimistic about Egypt’s domestic economic prospects.
The August PMI therefore points to a non-oil economy that remains technically in contraction, but with clearer signs of stabilisation and recovery compared with earlier months.
Reporting: Reuters
Editing: Hugh Lawson