Monthly, annual headline inflation accelerate again in October
Inflation accelerates again in October: Annual headline inflation rose to 17.5% in October, up from 16% the previous month, CAPMAS data showed (pdf). The state statistics agency attributed the rise to increases in vegetable prices and school fees. Monthly headline inflation also rose last month, coming in at 2.8% against 2.5% in September.
Accelerating inflation means no rate cuts in the near future: The central bank’s monetary policy committee is set to meet this Thursday, 15 November to review interest rates. Analysts had said last month that the central bank is unlikely to cut interest rates, particularly in light of the emerging markets sell-off, rising global oil prices, and impending fuel subsidy cuts here at home. The Institute of International Finance also predicted that monetary easing will not resume before 2019, when it expects headline inflation to decline to below 10%. The CBE had previously said that it expects inflation to come in at c.13% in 4Q2018 before dropping to the single digits over the course of next year “after the temporary effect of fiscal supply shock dissipates.”