Egypt’s annual inflation rate in urban areas has significantly decreased to 12.8 percent in February, down from 24 percent in January, marking the lowest level since March 2022.
This decline follows a peak of 38 percent in September 2023, driven largely by the devaluation of the Egyptian pound and subsequent currency liberalization.
Official data from the Central Agency for Public Mobilization and Statistics highlights a monthly inflation rate of 1.4 percent in February, a slight drop from 1.5 percent in January.
Contributing factors include an 8.2 percent decrease in vegetable prices, stability in water, electricity, and gas rates, and minor increases in the prices of grains, bread, meat, poultry, and fruits.
Experts are predicting a gradual interest rate cut of 1-3 percent in the upcoming Central Bank meeting, with some analysts suggesting reductions could reach as high as 10 percent by the end of the year if inflation continues to decrease.
The Central Bank aims to reduce inflation to between 5 percent and 9 percent by the end of 2026, and between 3 percent and 7 percent by 2028.The recent inflation trends present a mixed picture for the Egyptian economy, which has faced challenges since early 2022, including the effects of the Russian-Ukrainian war that prompted foreign investors to withdraw billions from the treasury markets.
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