Egypt's Inflation Deceleration Sparks Monetary Easing
Egypt's urban consumer price inflation slowed to 11.7% in September, below expectations, as the government continues its monetary tightening policy. This follows recent cuts in interest rates amid economic recovery efforts supported by an $8 billion IMF package and decreased money supply growth.
Egypt's urban consumer price inflation rate eased to 11.7% in September from 12% in August, according to CAPMAS data released on Wednesday. This deceleration fell short of analyst predictions, as a Reuters poll had anticipated inflation to ease to 11%.
The inflation slowdown is part of a two-year trend as the government tightens its monetary policy. September saw a 1.8% month-on-month rise in prices, with food and beverage prices increasing by 1.4% annually and 2.0% monthly.
Egypt's central bank responded to the slowing inflation by cutting its overnight lending rate by 100 basis points in October, following an earlier reduction of 200 basis points in August. These moves come after financial support from the IMF and a slowdown in M2 money supply growth.
(With inputs from agencies.)
Google News