Urban consumer price inflation in Egypt rose for the second consecutive month in September, reaching 26.4 percent, up from 26.2 percent in August, as reported by the country’s statistics agency, CAPMAS.
Month-on-month price changes
On a month-to-month basis, prices increased by 2.1 percent, consistent with the previous month’s 2.1 percent rise. Food prices saw a 2.6 percent increase, compared to a 1.8 percent rise in August, with September food costs being 27.7 percent higher than a year prior.
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Factors driving inflation
This recent inflation surge has been partially attributed to fuel price hikes of 10-15 percent at the end of July, a 25-33 percent increase in metro fares at the start of August, and a 21-31 percent rise in electricity rates during August and September.
Decline from record highs
Inflation had been on a gradual decline from a record high of 38.0 percent in September 2023, which allowed the central bank’s real overnight borrowing rate to turn positive at 27.25 percent in July for the first time since January 2022. Analysts surveyed had predicted a decrease in urban inflation to 26.0 percent for September.
Core inflation trends
Meanwhile, Egypt’s core inflation, which excludes volatile items such as fuel and certain food products, eased to an annual rate of 25.0 percent, down from 25.1 percent in August, according to separate data from the central bank. Five analysts surveyed by Reuters had anticipated that core inflation would fall to a median of 24.8 percent.
Monetary policy adjustments
Moreover, Egypt has implemented stricter monetary policies as part of an $8 billion financial support package from the International Monetary Fund, signed in March. This agreement has also necessitated raising various domestic prices and devaluing the national currency.
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