Egypt’s annual headline inflation in July rose to an all-time high of 36.5%, in line with analysts’ expectations, as food prices soared, data from the country’s statistics agency CAPMAS showed on Thursday.
Headline inflation was 35.7% in June, also a record high. Month on month, prices rose 1.9% in July, down from 2.08% in June.
The median forecast of 15 analysts polled showed annual urban consumer inflation rising to 36.5% in July. The previous high of 32.95% was recorded in July 2017.
Food and beverage prices rose by an annual 68.4% in July, CAPMAS said.
The third month of acceleration helps explain a surprise decision by the North African nation’s central bank last week to hike the main interest rate by 100 basis points to 19.25%.
The regulator sees consumer price increases peaking in the second half of 2023 before “beginning a disinflation path” toward a level of 5%-7% by the end of next year.
Egyptian inflation is bearing the brunt of three devaluations of the pound since early 2022 that helped secure a $3 billion International Monetary Fund loan.
The rate hike was unexpected because most analysts thought authorities would hold fire until they’d built up extensive foreign-currency buffers, including through a program of state-asset sales, and would only then conduct another currency adjustment.
