Egypt’s Core Inflation Decreases to 10% in February 2025 Amid Stabilization Trends

In February 2025, Egypt’s core inflation dropped to 10%, with significant declines noted in urban inflation as well. Monthly CPI inflation was recorded at 1.6%. CAPMAS reported that certain essential sectors experienced price reductions despite increases in others. The Central Bank of Egypt maintained unchanged interest rates, indicating careful oversight amidst economic uncertainties, while anticipating a continued decrease in inflation during early 2025.

In February 2025, Egypt’s core inflation decreased significantly to 10%, down from 22.6% in January 2025 and 13.2% in February 2024. The monthly core Consumer Price Index (CPI) inflation rate stood at 1.6%, slightly lower than January’s 1.7%. Notably, the annual urban inflation rate also fell to 12.8% from 24% in January, illustrating stabilization in inflation trends.

According to the Central Agency for Public Mobilization and Statistics (CAPMAS), urban monthly inflation eased to 1.4%, a decrease from January’s 1.5%. Furthermore, the national consumer price index reached 246.8 points in February 2025, indicating a 12.5% annual inflation rate, down from 23.2% in the prior month. CAPMAS attributed this decline to key sector price reductions, including an 8.2% decrease in vegetable prices.

However, several commodities saw price increases, with grain and bread prices rising by 0.8% and meat and poultry by 3.2%. Other notable increases included fish and seafood costs rising by 0.4% and dairy products by 0.7%. While household and housing-related expenses increased, some sectors, including housing services and electricity, showed stability in pricing patterns.

Medical and transportation expenses followed suit with noticeable price increases; outpatient services increased by 0.8%, and hospital services by 0.8%. The costs within education; primary education rose by 12.5%, while secondary education saw an increase of 4.3%. Furthermore, hospitality costs increased as prepared meal prices rose 0.5% and hotel services surged by 8.0%.

Overall, Egypt’s national monthly inflation rate for February 2025 was recorded at 1.4%, compared to 1.6% in January. The Central Bank of Egypt’s Monetary Policy Committee (MPC) decided to maintain the current interest rates for the seventh consecutive time, citing increased inflationary risks stemming from global economic uncertainties.

Despite the risks, the MPC anticipates a continued downward trend in inflation during the first quarter of 2025. It acknowledges the possibility of slower declines due to fiscal consolidation measures and aims to return inflation rates to historical norms within the medium term. Future policy decisions are to be assessed according to evolving economic conditions, maintaining a focus on controlling demand-driven pressures and mitigating supply shocks.

In conclusion, Egypt’s inflation landscape reflects a notable decrease in core inflation to 10% as of February 2025, indicating a positive trend towards stabilization. Although several commodities experienced price hikes, key reductions in other sectors contributed to lowering overall inflation rates. The Central Bank’s continued commitment to maintaining current interest rates signifies a cautious approach amidst ongoing uncertainties, while expectations for inflation trends suggest a responsive monetary policy aimed at sustaining economic stability.

Original Source: www.dailynewsegypt.com