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Egypt's August headline inflation jumps to a record 37.4%

Published 09/10/2023, 07:17 AM
Updated 09/10/2023, 07:20 AM
© Reuters. FILE PHOTO: Vendors wait for customers near traditional souvenir products of incense and medical displayed for sale, at a popular tourist area of the al-Hussein and Al-Azhar districts, in the capital city of Cairo, Egypt, July 10, 2023. REUTERS/Amr Abdall
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(Reuters) - Egypt's annual urban consumer price inflation rate surged to a higher-than-expected record 37.4% in August from 36.5% in July, data from the country's statistics agency CAPMAS showed on Sunday.

Headline inflation in July was 36.5% and in June 35.7%, both also all-time highs.

High money supply growth over the last two years has led prices to climb rapidly and triggered three devaluations since March 2022. Many Egyptians have seen their living standards slide.

Core inflation, which strips out volatile items like food and fuel, eased slightly to 40.4% from 40.7% in July and 41% in June, the central bank said.

Month-on-month, prices rose 1.6% in August, down from 1.9% in July and 2.08% in June, CAPMAS said.

Analysts said the gradual month-on-month decline could be a positive sign.

"It is tentatively a sign that prices are consolidating at these levels," said Allen Sandeep at Naeem Brokerage.

© Reuters. FILE PHOTO: Vendors wait for customers near traditional souvenir products of incense and medical displayed for sale, at a popular tourist area of the al-Hussein and Al-Azhar districts, in the capital city of Cairo, Egypt, July 10, 2023. REUTERS/Amr Abdallah Dalsh/File Photo

These included a 21.6% month-on-month increase in vegetable prices and a 5.8% increase in tobacco product prices, while meat fell 2.5% and bread and cereals 1.1%, according to analysts.

The median forecast of 14 analysts polled last week had shown annual urban consumer inflation rising to 37.1% in August. The previous high of 32.95% was recorded in July 2017.

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