Key insights
- Lebanon's PMI fell to a 17-month low of 47.4 in March, signaling a sharp contraction in the private sector due to the ongoing Middle East conflict. This led to decreased business activity, new orders, and exports. Supply chain disruptions and rising input costs contributed to increased inflation. Business confidence deteriorated amid concerns about prolonged military conflict. Limited direct impact on US equities, but serves as a reminder of geopolitical risks.
Investing.com -- Lebanon’s private sector contracted sharply in March as ongoing conflict in the Middle East weighed on business activity and demand, according to the latest BLOM Lebanon PMI data released Tuesday.
The headline BLOM Lebanon PMI fell to 47.4 in March from 51.2 in February, marking a 17-month low and the first reading below 50.0 in eight months. A reading below 50.0 indicates deteriorating business conditions.
Business activity levels shrank during the survey period, with the reduction being the fastest in close to a year and a half. Output declined as new orders fell, with survey participants citing the war in the Middle East, which led to cancellations or postponements from customers in some cases.
New export business saw a substantial decrease, the most pronounced since October 2024. International demand proved to be a considerable drag on order books.
Backlogs of work fell for the first time since July, partly reflecting order cancellations due to the war rather than genuine workload completions. Employment decreased fractionally at the end of the first quarter.
Companies retrenched during March, with purchasing volumes declining at the quickest rate in 16 months. Firms cited efforts to control costs and prevent overstocking. Stocks of purchases decreased for the first time since June 2025.
Supplier delivery times lengthened to the greatest degree in three years, with the war in the Middle East disrupting transportation and causing issues with imports.
Input cost inflation quickened to a six-month high, reflecting greater prices for energy and transportation, as well as commodities and food. Prices charged were raised at the most marked pace in six months.
The year-ahead outlook for business activity worsened sharply in March, with confidence falling as companies expressed concerns about the possibility of prolonged military conflict.
Dr. Ali Bolbol, Chief Economist at BLOMINVEST Bank, noted that the March 2026 reading mirrored levels seen in October 2024, when a similar war had occurred.
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