Inflation | Image:Unsplash
Egypt’s inflation surges: Egypt witnessed a sharp uptick in urban inflation in February, with the annual rate soaring to 35.7 per cent, according to statistics agency CAPMAS. This surge, up from January’s 29.8 per cent, was primarily driven by escalating prices in the food and beverage sector.
The inflationary spike comes ahead of the anticipated repercussions of the recent currency devaluation. Last week, the central bank’s decision to allow the Egyptian pound to depreciate to about 50 against the dollar, abandoning its fixed rate of 30.85 over the past year, is expected to further compound inflationary pressures.
Contrary to the expectations of 14 analysts, who had predicted a median inflation rate of 25.1 per cent for February, the actual figures surpassed projections. Prior to February, Egypt had been experiencing a gradual decline in inflation following a peak of 38.0 per cent in September.
On a month-on-month basis, prices surged by 11.4 per cent in February compared to a mere 1.6 per cent increase in January. Particularly notable is the substantial leap in food prices, which skyrocketed by 15.9 per cent in February compared to a 1.4 per cent rise in January.
Allen Sandeep of Naeem Brokerage highlighted that the sharp rise in annual inflation was fuelled by significant increases in both food and non-food items, despite the favourable base year contribution of -5.5 per cent.
(With Reuters Inputs)
