Egypt’s Inflation Hits Record High of 36 Percent as Prices Soar

According to recent data released by the Central Agency for Public Mobilization and Statistics (CAPMAS), Egypt’s annual inflation rate in February 2024 has surged to 36.0 percent, a significant increase from this January’s rate of 31.2 percent. 

The consumer price index climbed to 219.4 points during the same period. 

The rise in inflation can be attributed to soaring prices across various sectors. Key areas experiencing notable increases include meat and poultry (25.0 percent), cereals and bread (14.2 percent), fish and seafood (11.5 percent), dairy products such as cheese and eggs (12.8 percent), and oils and fats (14.1 percent).

Egypt’s urban consumer price inflation (CPI) witnessed a significant rise, reaching 35.7 percent in February 2024, up from January’s 29.8 percent.

To address the escalating inflation, the Central Bank of Egypt (CBE) has tightened its monetary policy, increasing key interest rates by a total of 19 percent since March 2022. 

In an effort to stabilize the economy, the CBE implemented an unprecedented six percent interest rate hike during an unscheduled meeting in March 2024, allowing the local currency rate to be subject to market forces.

To combat inflation, Egypt has taken measures such as releasing stockpiled commodities in ports, with a total value of USD 12 billion (EGP 592 billion). 

Additionally, Egypt recently signed a USD 35 billion (EGP 1 trillion) Foreign Direct Investment (FDI) deal with the UAE to develop the coastal zone of Ras El-Hekma.

The International Monetary Fund (IMF) has expanded its finance provided to Egypt under the Extended Fund Facility (EFF) program from USD 3 billion (EGP 148 billion) to USD 8 billion (EGP 395 billion).