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Egypt’s non-oil activity shrinks for 28th straight month as inflation shoots

Published

2 years ago

April 4, 2023

A recent survey by S&P Global on Egypt’s economy has revealed the country’s non-oil private sector activity shrank for the 28th straight month in March.

The survey shows that currency restrictions and rising inflation also affected businesses.

In January, the non-oil economy suffered a sharp contraction in operating conditions, as a depreciation of the pound drove a rapid acceleration in price pressures.

The S&P Global Egypt Purchasing Managers’ Index (PMI) edged down to 46.7 in March from 46.9 in February, well below the 50.0 threshold that marks growth in activity.

According to S&P Global economist David Owen, “at 46.7, the headline PMI signaled a further solid deterioration in the performance of non-oil companies, driven by steep falls in activity and new business volumes”.

“Steep inflationary pressures and a drop in client demand continued to negatively impact non-oil businesses, chiefly through a sharp reduction in new orders.

“Output levels fell at a marked rate across the non-oil private sector during March, in part due to ongoing difficulties with accessing key inputs due to import controls and currency restrictions.

“Despite picking up to a three-month high, the year-ahead outlook for activity was still among the weakest recorded since the series began in early-2012,” S&P wrote.

Despite the Egyptian pound depreciating by half since March 2022 and a $3 billion IMF assistance package signed in December, Egypt remains short of foreign currency.

According to the state statistics organization, headline inflation soared to 31.9% in February from 25.8% in January, while core inflation went up to 40.26%.

Egyptian economist, Sherif Kamel had predicted that Egypt’s economy in 2023 would be challenging, given the expected repercussions of the global recession, rising inflation, and currency uncertainty.

Related Topics:Egypt Egypt's non-oil Featured

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Moroccan annual inflation rises to 0.8% in November

Published

2 days ago

December 21, 2024

Ifeoluwa Dada

Morocco’s statistics office has confirmed that the country’s annual inflation rate, as determined by the consumer price index, increased from 0.7% in October to 0.8% in November.

Monthly, consumer prices decreased by 0.2% from October.

The primary driver of inflation, food costs, grew by 0.8% compared to the previous year, while non-food inflation climbed by 0.7%. Core inflation, which does not include more erratic items like food, increased 2.6% annually and 0.2% monthly.

According to the central bank, inflation is expected to average 1% this year, down from 6.1% last year.

Despite the Al-Haouz earthquake, a spike in inflation, and worldwide economic challenges, Morocco’s GDP grew by 3.4% in 2023.

A recovery in tourism, robust industrial exports, and rising private consumption—all bolstered by prudent macroeconomic policies—were the main drivers of growth.

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Nigeria’s $42bn foreign reserves enough for 9 months’ imports— Central Bank

Published

3 days ago

December 20, 2024

Ifeoluwa Dada

According to Olayemi Cardoso, Governor of the Central Bank of Nigeria (CBN), the nation’s $42.01 billion in foreign reserves can cover imports of goods and services for almost nine months.

Cardoso promised Nigerians improved economic fortunes in 2025 while addressing the Senate Committee on Banking, Insurance, and Other Financial Institutions yesterday in Abuja at the presentation of the performance index report.

Cardoso stated: “External Reserves rose from $ 38.35 billion it was on September 30, 2024, to $ 42.01 billion as of December 12, 2024”.

He clarified that third-party receipts in Q3 2024 and revenues from taxes connected to crude oil were the main drivers of the rise in foreign reserves during the specified time.

“We saw remarkable improvements in our trade balance and maintained a current account surplus,” he added.

“Our external reserves level can finance over 9.09 months of import of goods and services or 13.91 months only, higher than the international benchmark of 3.0 months and a robust buffer against shocks”.

On cash shortage, the CBN boss reiterated the N150 million fine against any branch of banks caught illegally distributing new Naira notes to currency hawkers and unscrupulous elements and said the Nigerian economy will improve in 2025 through policies and measures.

He predicted a stronger economic future: “Despite our economy’s challenges, there are clear reasons for optimism.

“The gradual stabilization of the forex market, ongoing banking sector recapitalization, and positive growth trends in key sectors, especially the services sector, indicate a path toward recovery and stability.”