An Egyptian woman shops at a fruits market in Cairo, Egypt May 10, 2016. (photo: Reuters)
Egypt’s annual inflation rates will range between six and eight percent in the long run, while between five and seven percent in the short term, assuming no major changes in terms of supply shocks over the rest of FY2019/2020, SHUAA Securities expects.
According to its Monetary Sector report, SHUAA said that the recent swift correction in oil prices will help contain inflationary pressure in the near term, adding that monthly core inflation is performing well for the third month in a row.
Inflation figures in February slowed in both monthly and annual aspects, as figures released by CAPMAS showed annual urban inflation retreating to 5.3 percent in February, down from 7.2 percent in January, with 0 percent monthly inflation against 0.8 percent, respectively.
Weaker inflation appeared to be the product of deflation in food and non-alcoholic beverages, following higher readings in the prior month. Real interest rates bounced back accordingly, still in positive territory, reaching to their highest levels since November 2019, according to SHUAA.
Meanwhile, the Core Consumer Price Index (CPI) released by the Central Bank of Egypt (CBE) showed annual core inflation of 1.9 percent in February, while monthly core inflation recorded 0.25 percent.