BLOM PMI Falls to 3-month low in March and Points to Sharper Economic Downturn

n spite of steady cost burdens on Lebanese businesses, the BLOM Lebanon PMI fell from 47.3 in February to 46.5 in March, indicating a more pronounced setback in the private sector’s activity. The output of surveyed Lebanese businesses recorded the sharpest rate of decline since December 2018. Aside from dealing with local difficulties, Lebanese businesses were also suffering from lower new orders from abroad, which recorded their steepest monthly decline in three months. Commenting on the March 2018 PMI results, Myrna Chami, Senior Economist at BLOMINVEST Bank, said: “Even though the levels of the PMI progressed during the first two months of 2018, the downturn in March meant that the first quarter’s average remained below the historical trend level signaling a disappointing start to the year for the private sector. In fact, the combination of weak demand and competitive pressures compelled firms to decrease their output prices despite rising input costs and the brief inflationary impact resulting from tax hikes in January. With private companies remaining pessimistic regarding the outlook over the next 12 months, parliamentary elections in May might constitute a catalyst for business activity in the period to come.”

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