CAIRO (Reuters) – Non-oil personal sector exercise in Egypt contracted for an 18th month in Might because the Ukraine disaster, import restrictions and a devalued forex put stress on costs, a survey confirmed on Sunday.

The S&P International (NYSE:) Egypt Buying Managers’ Index strengthened to 47.0 from April’s 46.9, however nonetheless remained under the 50.0 threshold that separates development from contraction.

“Rising worth pressures continued to weigh on consumer spending,” S&P International stated. “Enter price inflation quickened to the very best in six months amid rising world commodity costs, a stronger US greenback and the banning of quite a lot of imported items.”

“Subsequently, companies lowered their enter purchases and staffing ranges, whereas the outlook for future exercise weakened to its second-lowest within the collection historical past,” it added.

The import ban on sure merchandise induced provide shortages for a number of companies and a brand new requirement for letters of credit score for importing many items resulted in elevated customs delays, S&P International stated.

Headline inflation rose to 13.1% in April from 10.5% in March.

The sub-index for total enter costs jumped to 62.1 from 58.3 in April and that for buy prices rose to 62.3 from 58.8.

“Non-oil enterprise circumstances in Egypt remained pinned down by speedy inflationary pressures in Might, as survey panellists indicated that rising market costs led to a pointy drop-off in demand and an additional improve in enterprise bills,” stated S&P International economist David Owen.

Output and new orders in Might prolonged a months-long contraction, with the output index, at 45.0, worsening from April’s 45.3 and the index for brand new orders dropping to 44.6 from 45.3.

The sub-index for future output expectations declined to 55.2, its second lowest studying for the reason that survey first included the class 10 years in the past. The index was at 57.7 in April.