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  • 11-05-23

    Softer food prices lead to year-on-year dip in Egypt's inflation rate

    (MENAFN) According to the Central Agency for Public Mobilization and Statistics, Egypt's headline inflation rate saw a year-on-year dip in April for the first time in nine months. The drop was largely attributed to softer rises in food prices, with inflation falling from 32.7 percent in March to 30.6 percent in April. The country's food inflation also showed a decline, increasing by 54.7 percent in April, which was an 8.2 percent drop from the 62.9 percent increase the previous month.

    Additionally, the country's month-on-month urban inflation also saw a decline, falling to 1.7 percent in April from 2.7 percent in March and 6.5 percent in February, according to the Central Agency for Public Mobilization and Statistics.

    The rise in inflation over the previous year was largely due to currency devaluations, an ongoing foreign currency shortage, and import delivery delays. Despite the Egyptian pound's steep depreciation over the past few months, the country continues to face a foreign currency shortage.

    However, on Tuesday, rating agency Moody's placed Egypt's B3 issuer rating for both local and foreign currencies under review for a downgrade. This was due to the slower-than-expected progress with the state-owned asset sale, according to the agency.

    While the dip in inflation may provide some relief to Egyptians struggling with high costs of living, the country's ongoing economic challenges continue to pose significant hurdles. The foreign currency shortage, in particular, has impacted imports and led to increased prices for consumers. Moody's review of Egypt's credit rating also highlights the need for the country to address key economic issues, such as the slow pace of reforms and the need for greater foreign investment. Despite the challenges, however, the country's government remains committed to implementing economic reforms and promoting growth in the coming years.

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