Egypt Independent

Inflation hits highest levels in more than two years

The Central Agency for Public Mobilization and Statistics (CAPMAS) has announced that the annual inflation rate increased during February by 2.8 percent to 8.7 percent (132.8 points), reaching its highest monthly rate since September 2010.

CAPMAS head Major General Abu Bakr al-Guindy said Sunday that foreign exchange rates, especially with the Egyptian pound against the US dollar, caused price hikes across all sectors in February.

The biggest hikes were in food prices, which went up by 2.9 percent from January, but medicine prices also spiked and affected the local health care sector, Guindy said. He added that although diesel fuel and butane gas prices went up, they didn’t affect overall inflation rates.

The Egyptian economy has been hit hard since the January 2011 uprising overthrew former President Hosni Mubarak. The country is facing a budget deficit of LE180 billion, which it is seeking to fill with loans from other Arab countries and international organizations.

The government is in negotiations for a US$4.8 billion loan from the International Monetary Fund, which has offered the loan conditioned upon an economic reform program that includes austerity measures.

Edited translation from MENA