Egypt Watch

Egypt: Inflation hits 12.1, exceeding the target of the Central Bank of Egypt

The Central Agency for Public Mobilization and Statistics has announced that the inflation rate rose last March, on an annual basis, by 12.1%, reaching its highest level in nearly three years, which is more than the rate expected by the Central Bank, estimated at 5-9%. Every month, it added, the inflation rate rose by 2.4%.

According to the agency’s report, the price increase in rural areas reached 13.7%, reaching 10.5% in urban areas. The rise was driven by the rise in the prices of cereals and bread by 11%, meat and poultry by 7%, fish and seafood by 6.2%, and dairy, cheese and eggs by 5%. The FAO Food Price Index recorded 159.3 points in March and 17.9 points in February. According to experts, this is the highest level the index has reached since it was first launched in 1990, especially in vegetable oils, grains, and meat prices.

A researcher at HC, Sarah Saadeh, expected inflation to reach its peak during the current month. The most significant local determinant is the Automatic Pricing Committee’s decision regarding petroleum products. She also expected that the committee would move the price of fuel, which would lead to an increase in the prices of almost all local products and services.

Hisham Hamdi, an analyst at Naeem Brokerage, said that the inflation rise might push the Central Bank to raise interest rates again. However, Saadeh saw that this would be futile, although she did not rule out the step.