Back to the complete issue
Tuesday, 11 April 2017

Inflation rates show signs of cooling

Inflation is showing signs of cooling: You may now breathe a (tentative) sigh of relief. Consumer price inflation cooled again in March, standing at 2.0% month-on-month compared to February. M-o-m inflation was 2.63% in February and 4.07% in January. The annualized rated accelerated to 30.9%, up from 30.2% in February, its slowest gain in five months. The core inflation rate fell to 32.25% y-o-y in March from 33.1% a month earlier, the central bank said. The drop in the core rates is the first since November. “The initial price shock seems to be tapering off … Sharp changes in prices in the future will be linked to further reform measures, the usual fluctuation in the exchange rate or seasons when consumer demand increases,” Reham El Desoki, senior economist at Arqaam Capital told Bloomberg.

Inflation will be impacted by two seasonal factors in the coming two months, argues Pharos Holdings’ Ramy Oraby in a research note issued yesterday: The month of Ramadan, in which prices usually increase, and the wheat harvest season, “which tends to diffuse sharp food price movements.” He also adds that “at the current exchange rate level, the pass-through risks remain limited.”

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2022 Enterprise Ventures LLC.

Enterprise is available without charge thanks to the generous support of HSBC Egypt (tax ID: 204-901-715), the leading corporate and retail lender in Egypt; EFG Hermes (tax ID: 200-178-385), the leading financial services corporation in frontier emerging markets; SODIC (tax ID: 212-168-002), a leading Egyptian real estate developer; SomaBay (tax ID: 204-903-300), our Red Sea holiday partner; Infinity (tax ID: 474-939-359), the ultimate way to power cities, industries, and homes directly from nature right here in Egypt; CIRA (tax ID: 200-069-608), the leading providers of K-12 and higher level education in Egypt; Orascom Construction (tax ID: 229-988-806), the leading construction and engineering company building infrastructure in Egypt and abroad; Moharram & Partners (tax ID: 616-112-459), the leading public policy and government affairs partner; Palm Hills Developments (tax ID: 432-737-014), a leading developer of commercial and residential properties; Mashreq (tax ID: 204-898-862), the MENA region’s leading homegrown personal and digital bank; and Industrial Development Group (IDG) (tax ID:266-965-253), the leading builder of industrial parks in Egypt.