Reuters expects inflation in Egypt to ease slightly to 26.4 percent in November

The average forecast of 15 analysts polled by Reuters points to a rate cut Inflation Annual consumer prices in Egyptian cities rose to 26.4 percent from 26.5 percent in October.

“Falling prices of some food items, such as vegetables, may help slow down annual inflation,” said Israa Ahmed of Pharos Holding, noting their significant impact on the inflation index.

Inflation rose in August, September and October, but remained well below the all-time high of 38 percent reached in September 2023.

Data were collected for the month of November from December 28 to December 5.

It is mentioned that Egypt Last March, it signed a package of financial support worth eight billion dollars with… International Monetary FundWith the aim of helping it reduce the budget deficit and adopt a monetary policy that is less conducive to inflation. However, the IMF is asking the Egyptian government to reduce subsidies on some local products, leading to an increase in their prices.

The rapid growth of Egypt’s money supply helped to increase inflation. Data from the Central Bank show that the money supply (M2) grew by 29.54 percent in the year that ended at the end of October, which is slightly less than the all-time high of 29.59 percent recorded in the year that ended at the end of September.

In early November, the government allowed tobacco companies to raise cigarette prices.

Annual inflation also received a strong boost from a 10-15 percent increase in fuel prices in late July, another 11-17 percent increase in mid-October, a 25-33 percent jump in subway fares in early August, and a jump in subway fares for 21-21 percent and 31 percent of the price of chips for electricity in August and September.

Not all analysts believe that inflation will decline.

Mohamed Abu Basha of EFG Hermes said: “We expect inflation to accelerate further in Egyptian cities, with the impact of recent increases in fuel and tobacco prices showing through the numbers,” expecting inflation in Egyptian cities to reach 27.1 percent.

Five analysts expected core inflation to fall to 24.2 percent in November from 24.4 percent in October.