Inflation in urban parts of Egypt accelerated to its fastest pace in more than five years as last month’s steep currency devaluation heaped more pressure on consumers in the Middle East’s most populous nation.
The index climbed 25.8% year-on-year in January versus 21.3% the previous month, the state-run statistics agency CAPMAS said Thursday. The increase was driven by a 48% surge in food and beverage prices, the largest single component of the inflation basket.
On a monthly basis, inflation was 4.7%, the quickest since 2016.
Egypt’s government said tackling soaring prices for food and other commodities is its top priority for the country, where a large proportion lives around or below the poverty line.
The central bank is targeting inflation at an average of 7%, plus or minus 2 percentage points, by the fourth quarter of 2024. Its next Monetary Policy Committee meeting is due on March 30.
Prices are likely to accelerate further in the short term, spurred by an expected hike in fuel prices and increased demand during the holy month of Ramadan, which begins at the end of March and is marked by family gatherings and large meals.
Read also; Egypt’s Central Bank Keeps Interest Rate Unchanged Despite Rising Inflation.
