Egyptians likely to spend 1.2% more in 2024: Mastercard

Ahram Online , Thursday 21 Dec 2023

Egyptian real consumer spending is expected to increase by 1.2 percent year-on-year in 2024 despite inflation concerns, according to Mastercard Economics Institute’s (MEI) Economic Outlook report.

Tawfiqiya shopping market in downtown Cairo. Ahram Online
Tawfiqiya shopping market in downtown Cairo. Ahram Online

 

However, Egyptians will be less flexible regarding their purchases, as they will consider multiple factors at play including price variations and high interest rates, the report said.

In November, Egypt’s annual headline inflation decelerated to 36.4 percent, down from 38.5 percent in October, according to the Central Agency for Public Mobilization and Statistics (CAPMAS). 

Since March 2022, interest rates in the country increased by 11 percent.

“A strong labour market underpins consumer purchasing power and the Mastercard Economics Institute anticipates the easing of monetary policy will help sustain consumer spending in interest-sensitive sectors,” said David Mann, a chief economist at Mastercard.

Mastercard also expected improvement in the global economy in 2024 despite the persistent challenges of high interest rates and inflation.

“Central banks are likely at or close to peak rates. Some easing is expected next year as inflation cools, while growth remains subdued, prompting a partial normalization of monetary policy. Globally, inflation is expected to moderate to 4.9 percent year over year in 2024, down from 6 percent in 2023, but remaining above the pre-pandemic trend of 2.7 percent,” MEI said.

The global economic growth is expected to slow down from 3.5 percent in 2022 to 3 percent in 2023 and 2.9 percent in 2024, well below the historical (2000–2019) average of 3.8 percent, based on the estimates of the World Economic Outlook report published in October by the International Monetary Fund (IMF).

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