Egypt Inflation Accelerates, Still Below Central Bank Target

Egypt’s headline inflation accelerated at its fastest pace since December but remained below the target range, making rising global bond yields a more important factor in next week’s rate decision, Bloomberg News reported. The annual inflation rate climbed to 4.5% in February from 4.3% in January after two consecutive months of deceleration. On a monthly basis, consumer prices inched up 0.2%, the state-run statistics agency CAPMAS said Wednesday in a report. Egypt’s central bank is due to make its next interest-rate decision on March 18. The Monetary Policy Committee held the deposit rate at 8.25% last month, citing the continued impact of the coronavirus pandemic and efforts to contain it on the near-term growth outlook. Despite the latest increase in inflation, the North African nation still has one of the world’s highest real interest rates, a ranking that’s helped attract foreign investors to the local debt market. Consumer prices are below the authorities’ target of 7%, plus or minus 2 percentage points, for the fourth quarter of 2022. Read more.
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