Egypt: Inflation jumps to near three-year high in March
April 10, 2022
Consumer prices rose 2.21% in March over the previous month, picking up from February’s 1.61% increase. March’s result marked the strongest increase in prices since October 2018. The reading was driven by brisker price increases for food.
Inflation jumped to 10.5% in March, above February’s 8.8%, thus falling above the upper bound of the Central Bank’s 5.0–9.0% target range for the first time in 31 months. March’s print surprised markets on the upside and represented the highest inflation rate since May 2019. Accordingly, the trend pointed up, with annual average inflation coming in at 6.3% in March (February: 5.8%). Lastly, core inflation soared to a record 10.1% in March, up from February’s 7.2%.
Farouk Soussa, analyst at Goldman Sachs, added:
“We expect inflationary pressures to continue to rise in the coming months as the FX pass-through from the recent devaluation continues and global commodity prices remain elevated. We see CPI peaking at close to 17% by year-end, ignoring any second-round effects which we do not currently expect.”
Author: Marta Casanovas , Economist