Monthly core inflation excludes volatile items like food and energy.
Year-on-year, core inflation climbed to 10.4 percent in April, compared to 9.4 percent the previous month, according to the CBE.
Egypt’s urban headline inflation rose to 1.3 percent in April 2025, up from 1.1 percent in the same month last year, but slightly down from 1.6 percent in March, according to the Central Agency for Public Mobilization and Statistics (CAPMAS).
On an annual basis, urban consumer price inflation reached 13.9 percent in April, a modest increase from 13.6 percent in March, after almost five consecutive months of contraction.
This spike came against the backdrop of increasing the local retail fuel products by up to 33.3 percent applied in April.
Annual inflation saw a notable decline in the first quarter (1q) of 2025, driven by a favourable base effect, the cumulative impact of earlier monetary tightening, and the gradual fading of previous economic shocks.
By March 2025, annual headline inflation had slowed to 13.6 percent, while core inflation dropped to 9.4 percent, its lowest level in nearly three years.
The sharp deceleration in headline inflation was largely due to a steep drop in food inflation, which fell from 45.0 percent in March 2024 to 6.6 percent this year.
In contrast, non-food inflation proved more persistent, easing from 25.7 percent to 18.9 percent over the same period, according to CBE data.
The roughly 9-percentage-point drop in headline inflation during 1Q of 2025 allowed the CBE to begin easing policy, cutting it by 2.25 percent (225 bps) in its last meeting in April.
CBE said after the meeting that inflation is projected to decline further through 2025 and 2026, though at a more gradual pace than in the first quarter.
This slower disinflation is linked to the continued implementation of fiscal consolidation measures and the ongoing rigidity in non-food prices.
Nonetheless, the CBE warned that upside risks to the inflation outlook remain. These include the potential for a greater-than-expected passing of fiscal measures, uncertainties stemming from the ongoing China-US trade tensions, and possible escalations in regional geopolitical conflicts.
It is worth noting that the inflation ceiling the CBE targets is seven percent (±two percent) in the 4Q of 2026, and five percent (±two percent) in the 4Q of 2028.
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