Egypt Watch

The IMF expects a problematic year for Egypt

A report issued by the International Monetary Fund, Tuesday, revealed shocking expectations, indicating that Egypt’s inflation rate has increased from 5.8% (on an annual basis) in the 2019/20 fiscal year to about 8% on average in the 2020/2021 financial year. This increase is due to many essential factors, including the main effects resulting from the repercussions of the Coronavirus’ spread. The Fund stated that the Central Bank of Egypt adopts a monetary policy targeting inflation rates at 9% with a range of 3%, up or down. He also indicated that pressures on the state’s public finances continued; The debt-to-GDP ratio is expected to rise to 93%. The IMF said that external assets would continue to decline amid “significantly weaker global expectations and lower foreign inflows,” but expected the banking sector to maintain its strong performance.

The Central Agency for Public Mobilization and Statistics (CAPMAS) in Egypt announced that the total annual inflation rate was 4.6% last July, compared to 7.8% for the same month of the previous year. The agency explained that the annual change is due to the price declines of some food groups that recorded in July 2020 compared to the same month of 2019.