Egypt’s annual inflation posts 11.1% in December

Egypt’s annual consumer price inflation dropped to 11.1 percent in December 2018, compared to 22.3 percent in the same month of 2017, state-statistics body said Thursday, Jan. 10.

In November, Egypt’s annual consumer price inflation recorded 15.6 percent, compared to 26.7 percent in the same month of 2017.

On a monthly basis, inflation decreased 4.1 percent in December, compared to the previous month, to record 296.5 points, the Central Agency for Public Mobilization and Statistics (CAPMAS) said.

CAPMAS attributed the decrease in inflation on a monthly basis to the decline of some commodities’ prices as vegetables prices’ decreased by 22.4 percent, meat and chicken by 2.3 percent, fruits by 0.6 percent, and fish by 0.5 percent.

In the period from January to December 2018, the inflation rate hit 14.1 percent.
Inflation surged in Egypt since the floatation of the Egyptian pound in November 2016, reaching a high record level in July due to energy subsidy cuts, and gradually easing since July.

The International Monetary Fund (IMF) expected Egypt’s inflation to decline to 20.9 percent in 2018, compared to 23.5 percent in 2017, anticipating it to reach 14 percent in 2019 and 7 percent in 2023.

Meanwhile, the World Bank said that headline inflation remained at high levels of 21.6 percent during 2017/2018, but started to recede significantly by the end of the year, adding that core inflation returned to single digits in July 2018.

The World Bank clarified that the increase of energy prices caused a temporary rise in headline inflation to 14 percent on an average during June to August.

HC Securities & Investment also forecasted that Monetary Policy Committee (MPC) would keep rates unchanged in the fourth quarter of 2018, with anticipations that inflation would hit 14.8 percent from September to December.

“We expect the annual inflation rate to average 14.8 percent over September–December,” Equity Analyst – Macro & Banking Sector at HC, Monette Doss added.
Egypt targets an inflation rate of 13 percent in its fiscal year 2018/2019 budget.