With urban inflation reaching a new record high of nearly 36%, Egypt’s policymakers are expected to carry on with fiscal tightening policies amid expectations of a new stint of currency devaluation, Capital Economics said on Monday. The annual nationwide inflation rate has jumped to 36.8% from 14.5% in the same month last year, according to the same statement. However, recent inflation figures might force monetary policymakers to raise interest rates sooner, the note said expecting the CBE to adopt the hikes as early as August. “Looking ahead, inflation is likely to bump around its current rate over the remainder of the year. But there are two key upside risks,” Capital Economics said.

Source: The North Africa Journal July 10, 2023 12:52 UTC