Egypt’s government has set its sights on reducing the country’s inflation rate to less than 10 percent by the end of 2025 or the beginning of 2026, according to a statement made by Prime Minister Mostafa Madbouly.
This announcement comes as the nation’s statistics agency, CAPMAS, reported a decline in Egypt’s annual urban consumer price inflation, which slid to 25.7 percent in July from 26.5 percent in June.
On a month-over-month basis, prices fell by 0.4 percent in July, a softer drop compared to the 1.6 percent decline recorded in the previous month. While food prices dipped by 0.3 percent in July, they remained 28.5 percent higher than a year ago.
A poll of 18 analysts had anticipated the inflation rate to have decelerated to a median of 26.6 percent in July, marking a continuation of the downward trend that began in September, when inflation peaked at 38.0 percent.
Egypt’s commitment to tackling inflation has led the country to tighten its monetary policy under an $8 billion International Monetary Fund (IMF) financial support package signed in March. This program has also necessitated increases in domestic prices and a plunge in the value of the Egyptian currency.
In response, the central bank has hiked interest rates by 600 basis points (bps) on March 6, bringing the total increases in 2024 to 800 bps.
Furthermore, the government has raised the prices of certain subsidised products to address a budget deficit that reached EGP505 billion ($10.27 billion) in a 3.016 trillion pound budget for the fiscal year that ended on June 30.
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