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Egypt's inflation quickens to record 38% in September

Published 10/10/2023, 02:08 AM
Updated 10/10/2023, 08:55 AM
© Reuters. FILE PHOTO: A vendor sits next to an image of Egyptian Ptsident Abdel Fattah el-Sisi, at a vegetable market in Cairo, Egypt October 9, 2023. REUTERS/Mohamed Abd El Ghany/File photo
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CAIRO (Reuters) -Egypt's annual urban consumer price inflation rose to a historic high of 38.0% in September, climbing from 37.4% in August and topping analyst expectations, data from statistics agency CAPMAS showed on Tuesday.

It was the fourth consecutive month of record highs recorded on the central bank website, which has figures going back to 2000, with food and drink prices leading the rise.

The median forecast of 18 analysts polled this week had shown annual urban consumer inflation rising to 37.6% in September.

The previous high, before inflation soared in June, was 32.95% recorded in July 2017.

Inflation also accelerated on a monthly basis, with prices rising by 2.0% compared with a 1.6% increase in August, Allen Sandeep of Naeem Brokerage said. It was their fastest pace of increase since June.

Rapid money supply growth over the last two years has helped prices to climb rapidly and the currency to lose almost half its value against the U.S. dollar since March 2022. Many Egyptians have seen their living standards slide.

In September food and beverages climbed month-on-month by 3.6%, with vegetable prices surging by 19.2%, fruits by 5.4%, dairy products by 5.4% and sugar items by 2.9%, Sandeep added.

© Reuters. FILE PHOTO: A vendor sits next to an image of Egyptian Ptsident Abdel Fattah el-Sisi, at a vegetable market in Cairo, Egypt October 9, 2023. REUTERS/Mohamed Abd El Ghany/File photo

Seeking to fight food inflation, the government said on Monday it had agreed with private producers and retailers to cut prices on staple foods by 15-25% and exempt them from customs duties for six months.

Core inflation, which strips out volatile items like food and fuel, retreated to 39.7% from 40.4% in August, the central bank said.

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