Egypt’s annual urban consumer price inflation accelerated to 10.5 percent in March, the highest level in nearly three years and quicker than analysts had predicted, according to figures released on Sunday by the national statistics agency CAPMAS.
The rate of inflation, which increased from 8.8% in February, was higher than the median expectation of 10% in a Reuters survey of 14 economists.
Commodity shortages following Russia’s invasion of Ukraine contributed to the price rises, which pushed inflation above the central bank’s 5-9 percent target and 9.25 percent overnight lending rate.
Inflation is expected to rise considerably higher in the months ahead, according to some researchers.
‘The rise in inflation trends is largely predicted to peak in August 2022, following which it will begin to normalise,’ stated Pharos Securities Brokerage’s Radwa El Swaify.
Meanwhile, Sara Saada of CI Capital predicted that the government would raise fuel prices this month.
‘As a result, we estimate monthly inflation to peak in April, with annual inflation between 12.5 and 13%,’ she said, citing increasing petroleum product costs.
The surge, according to Naeem Research, was mostly due to increasing commodity costs and the currency devaluation on March 21.
‘We expect inflation to climb further in April as the full effects of the Egyptian pound depreciation (of 15% versus the US dollar) are expected to seep down into the economy,’ it wrote in a note.
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