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Egypt private sector continues to shrink for fifth month

A man counts Egyptian pounds at currency exchange shop in downtown Cairo on 3 November 2016. [KHALED DESOUKI/AFP via Getty Images]
A man counts Egyptian pounds at currency exchange shop in downtown Cairo on 3 November 2016. [KHALED DESOUKI/AFP via Getty Images]

Egypt's non-oil private sector shrank for a fifth month in April amid a drop in sales and employment, American-British research company, IHS Markit, announced yesterday.

IHS's Purchasing Managers' Index (PMI) for Egypt stood at 47.7 compared to 48.0 in March , marking the lowest score since June. The company attributed the continued contraction to a "rapid decline in sales and employment, high input costs, and weak market conditions."

"Firms generally reported that weaker market conditions led to a drop in client demand," the company was quoted by Reuters as saying.

It pointed out that the expectations of future output, which was predicted at 65.0, were still "solid but softer than the 77.2 recorded in March when the rollout of a COVID-19 vaccine programme raised hopes of a rebound."

The entire Egyptian non-oil private sector began contracting in December, ending three months of growth and expansion, due to resurgence in coronavirus infections.

"Notably, a number of companies reported that higher raw material prices led them to put purchasing decisions on hold during the month, instead utilising existing stocks," the research company noted.

READ: Egypt on the brink as third covid wave engulfs the country

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