Egypt’s urban inflation dropped to 9 per cent in August, down from 10 per cent in July.
Consumer prices rose by 1.5 per cent in the month to August, with food prices increasing by 3.1 per cent. Food prices were up by 13.4 per cent on August 2008.
“We had expected the 4.2 per cent month-on-month rise in food prices in July to be a one-off Ramadan-related effect, but clearly the Ramadan effect has continued into August,” investment bank EFG-Hermes said in a statement on 9 September.
Egypt’s rate of inflation in rural areas reached 7.6 per cent in August. The country’s combined inflation rate stood at 8.4 per cent.
EFG-Hermes said it expects the Central Bank of Egypt to cut interest rates by 50 basis points when it meets on 17 September.
This would bring overnight deposit rates down to 8 per cent and overnight lending rates to 9.5 per cent.