CAIRO: Egypt’s annual inflation surged to 11.8 percent in March, marking roughly a 1.1 percent rise from 10.7 percent in February, the Central Agency for Public Mobilization and Statistics (CAPMAS) announced Thursday.
This hike brought annual inflation to its former peak after the government cut energy subsidies by 40 billion EGP ($5.6 billion) in July, which raised transportation prices by up to 78 percent.
Urban consumer inflation also rose to 11.5 percent in March, up from 10.6 percent in February, according to CAPMAS.
CAPMAS attributed the rise mainly to a 28.4 percent hike in butane gas cylinder prices, while the prices of vegetables and meats rose by 6.4 percent and 1.6 percent respectively.
In its last meeting Feb.27, the Central Bank of Egypt (CBE) decided to keep the overnight deposit and lending unchanged at 8.75 percent and 9.75 percent respectively. Central Bank’s main operation and the discount rate were also kept at 9.25 percent each.
Meanwhile, banking experts urged the central bank to increase interest rates of local currency deposits to combat dollarization and reduce cash liquidity, in order to restrain inflation pressures that may occur due to local currency depreciation against the dollar in a country that imports more than 60 percent of its needs.