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World News March 8, 2023

Egypt February inflation seen rising to highest in more than 5 years

A Reuters poll showed on Tuesday, Egyptian urban consumer inflation will rise in February to its highest level in well over five years, following a series of devaluations in the Egyptian pound in January.

The median forecast of 14 analysts showed annual inflation rising to 26.7 percent in February from 25.8 percent in January. This would be its highest since October 2017, when it reached 30.82 percent.

The pound weakened by nearly 24 percent against the dollar over the course of January, bringing its total depreciation to almost 50 percent since March of last year.

The government fuel pricing committee last week raised petrol prices by nearly 10 percent at its quarterly meeting, but left the price of diesel unchanged, a move possibly designed to slow increases in cargo and mass transport prices.

Egypt has made few adjustments to local fuel prices over the last 12 months even as its currency slumped, meaning prices have fallen far below international prices.

Six analysts also forecast that core inflation, which excludes fuel and some volatile food items, would climb to 32.85 percent in February from an actual 31.24 percent in January.

Mounting inflation could put pressure on the central bank’s Monetary Policy Committee to raise interest rates when its next meets on March 30.

Sources: CGTN

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