Egypt’s finance minister expects inflation to fall 10-13% at year-end
Egypt’s inflation is expected to fall between 10 to 13 percent at the end of the current year, Finance Minister Amr el-Garhy said on Saturday on the sidelines of the third annual Arab Fiscal Forum in Dubai.
The forum is organised by the Arab Monetary Fund and the International Monetary Fund, in Dubai, in preparation for the annual World Government Summit, which will take place on Sunday, February 11th.
Egypt’s annual inflation rates dropped in January to their lowest levels since the country floated its currency in November 2016, official data showed earlier on Thursday.
The Egyptian pound lost half of its value and prices shot up after Egypt floated the currency in November 2016 to secure a $12 billion International Monetary Fund (IMF) deal to revive its economy.
Annual urban consumer price inflation eased to 17.1 percent in January from 21.9 percent in December while annual core inflation, which strips out volatile items, fell to 14.35 percent from 19.86 percent.
Inflation reached a record high in July of around 35 percent on the back of energy subsidy cuts but then gradually declined as inflationary pressure caused by Egypt floating its currency eased.
The IMF said in a report last month it expected inflation to fall to 12 percent by June and to single digits by 2019. It warned against a premature rate cut and urged the CBE to remain vigilant.
Egypt’s central bank has raised key interest rates by 700 basis points since November 2016 in an attempt to ease soaring inflation.
Despite inflation easing, many Egyptians say they are still finding it hard to make ends meet.
Bringing down inflation is key for President Abdel Fattah al-Sisi who is running for a second term in a March election and is widely expected to win.