Egypt annual inflation eases to 33.3% in March – CBE

Egypt’s annual headline inflation fell to 33.3 per cent in March, down from 35.7 per cent the previous month, according to a statement released by the Central Bank of Egypt (CBE).

This decline is attributed to a combination of factors, including a subdued increase in prices across the board in March and a favorable base effect from last year, the statement said.

Food inflation, a major driver of overall inflation, dropped to 45.0 per cent in March, marking its lowest level since December 2022. This indicates a potential easing of the food inflation that peaked at 73.6 per cent in September 2023.

Meanwhile, non-food inflation remained relatively stable at 25.7 per cent in March, as per the statement.

Core inflation, which excludes volatile items like food and energy, echoed the trend of headline inflation, dropping to 33.7 per cent in March from 35.1 per cent in February.

This slowdown reflects a weaker contribution from core food items and aligns with a lower monthly core inflation rate of 1.4 per cent in March compared to 2.5 per cent during the same month a year ago.

Monthly inflation records low

March saw the lowest monthly headline inflation rate in almost a year and a half at 1.0 per cent. This marks a significant decline from February’s 11.4 per cent increase and the highest monthly rate in recent memory.

However, it is worth noting that the seasonal impact of Ramadan slightly affected some key categories, including core food items like poultry and services related to religious pilgrimages.

Additionally, restaurant and healthcare services saw modest price increases.

Rural annual headline inflation dropped to 32.8 per cent in March compared to 36.3 per cent in February, while nationwide inflation fell to 33.1 per cent, down from 36.0 per cent in February.

Food prices show upward, downward trends

Fresh vegetables prices dropped 4.8 per cent, contributing negatively 0.19 percentage points to monthly inflation.

Conversely, poultry and red meat prices rose 3.3 per cent and 1.0 per cent respectively, pushing inflation slightly higher.

Other core food items, including eggs, tea, and coffee, also contributed to inflation.

Dairy products saw a 2.2 per cent price increase, while market sugar and fish and seafood rose 5.1 per cent and 1.2 per cent respectively. These increases had a relatively small impact on inflation.

Services drive higher inflation

Services experienced a 1.4 per cent price rise, contributing more significantly to inflation.

This increase was mainly driven by higher costs associated with restaurants and cafes, healthcare, rental values, and Omra pilgrimage trips.