Central Bank of Egypt reveals reasons behind high inflation

Egypt’s annual headline urban inflation increased to 6.6% in September 2021 from 5.7% in August, driven by strong monthly dynamics as well as unfavourable base effects.

This comes as monthly headline urban inflation recorded 1.1% in September compared to 0.3% in September 2020. Consequently. While annual headline urban inflation recorded its highest rate of 6% for the first time since January 2020.

According to the Central Bank of Egypt (CBE), the monthly headline urban inflation in September was mainly driven by food items. 

The increase in food prices reflected mainly higher prices of fresh vegetables, specifically tomatoes, and was further supported by higher prices of core food items, mainly poultry and meat. 

Meanwhile, the slight increase in non-food items reflected mainly the effect of an increase in the prices of cafes and restaurants (services) as well as vehicle operating expenses (regulated items), which was partially offset by lower prices of clothing (retail items).