Egypt: Inflation steady at over-seven-year high in July
August 10, 2016
In July, consumer prices rose 0.7% over the previous month, slightly below the 0.8% increase tallied in June. According to the Central Bank, the rise mainly reflected higher prices for fresh vegetables and fruits, rice and paid services.
Inflation came in at 14.0% in July, thus matching June’s figure and resting at the highest level since January 2009. Despite the government’s continuous efforts to reduce inflation and curb the outflow of foreign exchange, March’s marked devaluation of the pound heightened inflationary pressures, rendering such efforts partially useless. Furthermore, the recent announcement of severe hikes in electricity prices will likely have knock-on effects on services and goods and further push consumer prices upwards.
Meanwhile, annual average inflation rose from 10.2% in June to 10.7% in July. Core inflation, which excludes volatile items such as fresh fruit and vegetables, came in at 12.3% in July, a tad lower than June’s record-high 12.4%.
Author: David Ampudia, Economist