MACRO NOTE: Non-oil private sector took a breather in May, but outlook remains cloudy
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Egypt/ PMI may reading
Non-oil private sector delivered a sign of soft rebound in May as the headline PMI index rose 11 points to 40.7, up from 29.7—its lowest record since the series began in 2017. This reading, however, is still well below the expansion territory and marks the tenth consecutive reading of deteriorated business conditions in the non-oil private sector. The worst may have passed, but it is unlikely to expect the sector to fully recover any time soon, given the significant impact of the COVID-19 dual (supply and demand) shock. Moreover, the duration and the magnitude of risks triggered by the outbreak are still raising concerns as the number of infections in the country continues to increase. Re-escalating trade tensions between the U.S. and China and geopolitical threats are yet another serious risk, which further takes a heavy economic toll on the sector’s long road to recovery.
Mona Bedeir
Senior Economist
Tel.: +202 3300 5722