Egypt Watch

Egypt: Inflation jumps to its highest rate in 3 years

The Central Agency for Public Mobilization and Statistics has announced that annual inflation was recorded in April at 14.9%, the highest rate in three years.

Macroeconomic analyst at CI Capital Sarah Saadeh suggested that the main direct reason for the rise in the inflation rate is the effects of the change in the pound’s price against the dollar and the increase in demand for food commodities.

Saadeh expected that April would mark the peak of the monthly inflation rise, which recorded 3.7%. Its rates would gradually decline after that, unlike the annual inflation, which is likely to continue its high rates in the following months due to the effects of the previous year.

Prime Securities expected that the rise in the inflation rate would contribute to the Central Bank’s tendency to raise the interest rate at its next meeting this month by 1%. Food prices led, in particular, the increase in the annual inflation rate, as the rise in food and beverage prices amounted to 29.3%. The rise in food and beverage prices significantly impacts the inflation rate due to the high relative weight of food and beverage prices in calculating the total inflation rate.

Professor of Water Resources at Cairo University, Nader Nour El-Din, believes that vegetables, in general, are supposed to be among the food items least affected in their prices by the repercussions of the Russian war on Ukraine due to Egypt’s self-sufficiency.