CAIRO (Reuters) - A slump in Egypt's non-oil private sector showed signs of easing in May as improving price stability after the country's currency devaluation in March and its $8 billion loan agreement with the IMF began to restore confidence, a survey showed on Tuesday.
The S&P Global Purchasing Managers' Index (PMI) for Egypt climbed to 49.6 in May from 47.4 in April, remaining below the 50.0 threshold for the 42nd consecutive month. A reading below 50 reflects a contraction in activity.
"Business activity fell at only a moderate pace during May, reflecting a mixed picture across the sectors covered by the survey," S&P Global said.
"Manufacturing and wholesale & retail posted further declines, contrasting with uplifts across services and construction."
Business sentiment improved for a second month, with the future output expectations index climbing to 55.9 in May from 55.3 in April.
"Confidence towards the 12-month outlook ticked higher in May, as firms' hopes that economic conditions will strengthen grew," S&P Global said.
"Improved prospects encouraged companies to increase their staffing numbers for the second time in three months, while purchases of inputs declined at the slowest rate since February 2022."
The employment sub-index rose to 50.9% from 49.7 in April.
S&P economist David Owen said respondents had suggested that greater price stability had fuelled client spending.
"That said, ongoing downturns in industries such as manufacturing and wholesale & retail show that the recovery is still lopsided and may take more time to spread across the rest of the economy," Owen said.
The output sub-index rose to 48.7 in May from 44.8 in April and the new orders index climbed to 48.9 from 45.5.
(Reporting by Patrick Werr; Editing by Susan Fenton)
