Egypt’s headline inflation inches up to 26.4% in September

Egypt’s annual urban consumer price inflation climbed for a second month in September, rising to 26.4 per cent from 26.2 per cent in August, data from the country’s statistics agency CAPMAS showed on Wednesday.

Month-on-month, prices rose by 2.1 per cent, unchanged from a similar 2.1 per cent increase in August. Food prices rose by 2.6 per cent compared with 1.8 per cent in August. September food prices were 27.7 per cent higher than they were a year earlier.

Recent inflation was driven in part by fuel hikes of 10-15 per cent near the end of July, a 25-33 per cent jump in metro ticket prices at the beginning of August and a 21-31 per cent increase in electricity tariffs in August and September.

Inflation had been gradually declining from a record high of 38 per cent in September 2023, turning the central bank’s real overnight borrowing rate, at 27.25 per cent, positive in July for the first time since January 2022.

A poll of 19 analysts had forecast urban inflation would ease to 26 per cent in September.

Egypt’s core inflation, which strips out volatile items such as fuel and some types of food, slowed to an annual 25 per cent from 25.1 per cent in August, separate central bank data showed.

Five of the analysts polled by Reuters had expected core inflation to slip to a median 24.8 per cent.

Egypt has tightened monetary policy under an $8bn International Monetary Fund financial support package signed in March, which also required it to increase many domestic prices and devalue its currency.

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