CAPMAS attributed the increase mainly to a 2 percent rise in the food and beverages category, led by a 12.7 percent increase in fruit prices. Meat and poultry prices rose by 3.5 percent, fish and seafood by 1.3 percent, oils and fats by 0.5 percent, and cereals and bread by 0.3 percent.

Despite the increase, prices of dairy products, cheese, and eggs fell by 1.8 percent month-on-month in May.

Meanwhile, the telecommunications category recorded the highest monthly increase at 9.7 percent, driven by a 10.4 percent rise in telephone and fax service prices.

The housing, water, electricity, gas, and fuel category increased by 2 percent. This was driven by a 3.1 percent increase in actual housing rents, followed by a 1 percent rise in electricity, gas and other fuels, a 0.8 percent increase in housing maintenance and repair, and a 0.2 percent rise in water and miscellaneous services.

Clothing and footwear prices rose by 1.4 percent, furniture, household equipment and maintenance costs increased by 1.2 percent, while restaurant and hotel prices rose by 1.1 percent.

Healthcare costs increased by 0.2 percent, reflecting a 0.7 percent rise in outpatient services and a 0.3 percent increase in hospital services.

Transport costs rose by 0.1 percent, supported by a 1 percent increase in vehicle prices and a 0.5 percent rise in private transport costs. Restaurant and hotel prices also increased by 1.1 percent.

In contrast, the culture and entertainment category fell by 0.2 percent, due to a 0.9 percent decline in the cost of organized tours.

On an annual basis, headline inflation eased to 13 percent in May, down from 13.4 percent in April and from 16.5 percent in May 2025.

CAPMAS data showed that the housing, water, electricity, gas, and fuel category recorded the highest annual increase at 30.8 percent. This was driven by a 26.3 percent rise in actual housing rents, a 13.4 percent increase in housing maintenance and repair costs, and a 3.6 percent rise in water and miscellaneous services.

Transport and communications prices rose by 21.4 percent year-on-year, driven by a 24 percent increase in transport services, a 19.6 percent rise in private transport costs, and an 11.6 percent increase in vehicle prices.

Education recorded a 20 percent annual increase, driven by a 364.5 percent rise in post-secondary and technical education costs. Pre-primary and basic education costs increased by 22 percent, while general and technical secondary education costs rose by 15.3 percent.

Restaurant and hotel prices increased by 13.4 percent, while miscellaneous goods and services rose by 12.6 percent.

Food and beverage prices increased by 7.5 percent, while healthcare costs rose by 5.3 percent.

Furthermore, due to recent geopolitical tensions in the region, persistent external risks, uncertainty surrounding the inflation outlook, and rising energy prices, the Central Bank of Egypt decided to keep key policy interest rates unchanged in May.

The next Monetary Policy Committee (MPC) meeting to decide on key interest rates is scheduled for 9 July.

The MPC said inflation is expected to remain above the Central Bank of Egypt’s target rate of 7 percent (±2 percentage points) on average during the fourth quarter of 2026 before gradually easing in the first quarter of 2027 and returning to target levels in the second half of 2027.

The committee said maintaining a tight monetary policy stance, alongside a flexible exchange rate regime, would help keep inflation on track while allowing policymakers to monitor inflation trends and expectations.

These measures are part of the conditions of Egypt's International Monetary Fund (IMF) programme, which is due to conclude in mid-December. The IMF is currently in Cairo to conduct the seventh review of Egypt's Extended Fund Facility (EFF) programme and the second review under the Resilience and Sustainability Facility (RSF). The reviews should be completed within the next few days, unlocking around $1.6 billion in new financing for Egypt.

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