Egypt’s annual urban consumer price inflation rose to 13.6% in March from 12.8% in February, exceeding analysts’ forecasts, according to data released by the state statistics agency CAPMAS on Thursday.
A Reuters poll of analysts had projected a decrease in inflation to 12.6%.
On a monthly basis, consumer prices increased by 1.6% in March compared to February. Food and beverage costs saw a 3.5% rise over the month.
Annually, food and beverage prices surged by 6.6% in March, a sharp rise from 3.7% in February.
In February, annual urban inflation had dropped significantly to 12.8% from 24.0% in January, largely due to a statistical base effect, as the unusually rapid price increases from the past two years were no longer factored into the calculations, according to analysts.
Inflation initially soared following Russia’s invasion of Ukraine in early 2022, which led foreign investors to pull billions of dollars from Egypt’s treasury markets. In response, the Egyptian government resorted to printing more money to cover its budget shortfall.
The country’s inflation hit a record high of 38.0% in September 2023.
Meanwhile, M2 money supply has continued to expand, reaching a historic high of 33.9% year-on-year by the end of February, as per central bank data.
In March last year, Egypt took significant steps to stabilize its economy, devaluing its currency, raising interest rates by 600 basis points, and securing an $8 billion financial support package from the International Monetary Fund.
