CAIRO: The monthly inflation rate in Egypt increased by 3.3 percent in July compared to 0.9 percent in June. This was the highest rate since May 2008 with 4.7 percent, according to the Central Agency for Public Mobilization and Statistics (CAPMAS) monthly statistical bulletin issued Sunday.
Compared to Egypt’s annual inflation of 10.7 percent in 2013, it registering its highest rate since January 2014 at 12.2 percent, it reported.
The report attributed the past surge of the inflation rate to the intensive demand in goods and services and the hike of oil, electricity, and tobacco prices.
Tobacco increased by 16.1 percent, electricity by 27.9 percent, transportation by 11.2 percent, and vegetables by 7.4 percent.
Fuel prices in Egypt increased between 40 percent and 78 percent for petrol and 175 for natural gas in early July following President Abdel Fatah al-Sisi’s decision to reduce subsidies, Al-Shorouq news reported on July 5.
“The last surge in interest rate and the application of minimum wage also caused the inflation rate increase,” economic expert and former head of Al-Watany Bank Ahmed Qura told The Cairo Post Sunday.
The holy month of Ramadan during the month of July already witnessed high rates of consumption, he added.
Qura said the core solution to avoid inflation is to increase production of goods and services of consumption.
The Monetary Policy Committee (MPC) at the Central Bank of Egypt (CBE) raised the overnight deposit rate and overnight lending rate by 100 basis points to 9.25 percent and 10.25 percent respectively, and the rate of the CBE’s main operation at 9.75 percent.