Egypt Inflation Rate Down to 7.6% in March


In Egypt, the annual headline inflation rate eased to 7.6 percent in March of 2013, breaking a three-month increase, as a result of lower-than-expected rise in both food and non-food prices.

Headline CPI inched up by 0.64 percent (m/m) in March compared to 2.50 percent (m/m) in February, standing significantly below the average monthly pace of 2.09 percent recorded in January and February 2013. The annual rate decelerated to 7.59 percent in March from 8.21 percent in February.

After declining between October and December 2012, prices of fresh vegetables rose for the third consecutive month by 3.48 percent (m/m) in March following a cumulative 8.04 percent (m/m) increase in January and February. In the meantime, prices of fresh fruits rose by 0.87 percent (m/m) in March compared to a 0.73 percent inch up in the previous month. Together, the prices of fruits and vegetables contributed by 0.27 percentage points to monthly headline inflation in March.
 
After rising by 14.76 percent (m/m) since the beginning of 2013, poultry prices increased by 4.74 percent (m/m) in March to contribute by 0.23 percentage points to monthly headline inflation. In the meantime, red meat prices remained mostly unchanged for the fifth consecutive month.
 
Rice prices increased by 3.89 percent in March to contribute by 0.09 percentage points to monthly headline inflation, bringing the cumulative monthly increase to 14.76 percent since the beginning of the year. The monthly increases observed in 2013 thus far have more than offset the cumulative decline of 8.25 percent recorded in 2012.
 
Prices of several food items witnessed increases in March, including fish & seafood, edible oils, wheat flour, cheese, market tea and maize, contributing by 0.12 percentage points to monthly headline inflation.
 
Prices of eggs declined by 4.15 percent (m/m) to contribute by a negative 0.07 percentage points in March following a 15.14 percent cumulative increase in January and February.
 
Prices of other services experienced a marginal increase in March, on the back of higher prices of restaurant meals and furniture moving services. In the meantime, prices of paid services remained unchanged, while prices of retail items experienced a negligible decline.
 
Core CPI inched up by 0.51 percent (m/m) in March compared to 2.86 percent (m/m) in February. This month’s increase is significantly lower than the average monthly pace of 2.08 percent recorded in January and February. The annual rate declined to 7.03 percent in March from 7.68 percent in February.
The bulk of the monthly increase in March was driven by the higher food prices mentioned above which contributed by 0.50 percentage points to monthly core inflation. Changes in the prices of retail items and other services contributed by a mere 0.01 percentage points to monthly core inflation.
 

Central Bank of Egypt | Joana Taborda | joana.taborda@tradingeconomics.com
4/15/2013 10:27:51 AM