Escalators at the City Mall shopping center in Hazmieh, on March 11, 2026. (Credit: Philippe Hage Boutros / L’Orient-Le Jour)
The Purchasing Managers’ Index (PMI) in Lebanon improved again in May, according to the latest update published Wednesday by Blominvest.
Despite the war between Hezbollah and Israel — and a cease-fire reached on April 16 that has not been respected — the index rose by 1.5 points compared to April. This marks its second consecutive month of increase and brings the PMI to its highest level in three months.
At 49.7 points, the index is once again approaching the 50-point threshold. A reading below 50 signals a contraction in activity, while a figure above 50 indicates recovery. The May reading therefore suggests that purchasing managers at the 400 local companies surveyed by Blominvest remain pessimistic, though less so than a month earlier.
Blominvest chief economist, Mira Saeed, attributed the PMI improvement in May to gains in the sub-indices for total new orders and new export orders. The former rose from 46.5 to 49.7, while the latter climbed from 30 to 41.9.
The increase in export orders suggests that the April 8 cease-fire between Iran on one side and the U.S. and Israel on the other, as well as a nominal cease-fire in Lebanon, has allowed some businesses to resume export activities, previously disrupted by conflict-related interruptions to maritime and air transport. While violations to the cease-fire between Israel and Lebanon have continued, they have largely been confined to the South and the Bekaa.
"The regional and local cease-fires, though imperfect, appear to have offered some respite to Lebanese private companies," Saeed said. The output sub-index has also improved, rising from 47.4 to 49.5 points.
The employment sub-index, however, fell from 49.6 to 48.9 points, as some companies began reducing staff wages. Meanwhile, the sub-index measuring business expectations for the coming 12 months rose sharply, from 19.2 points to 24.3 points. Despite the increase, it remains negative as uncertainty continues to cloud Lebanon's summer outlook as well as the wider region.
"These two trends will only reverse significantly if, and only if, the war comes to an end, sovereignty is restored and structural reforms are implemented," Mira Saeed said.
Lebanon’s GDP is expected to contract by between 7 and 10 % this year because of the war, according to estimates presented in May by Finance Minister Yassine Jaber.
This estimate is more optimistic than projections issued by several economists and institutes, including the Institute of International Finance, since the conflict began on March 2. Jaber also estimates the cumulative cost of this war and the previous one between Hezbollah and Israel at $20 billion.
