Driven by the deceleration in food inflation, annual headline inflation eased for the first time in three months. Annual urban headline fell to 5.4% in December, down from 5.7% in November, ending 2020 at average inflation of 5.1%. The average inflation level in Q4 2020 came in line with expectations, registering 5.2%, below the Central Bank of Egypt’s (CBE) target range of 9% ± 3% in Q4 2020. Thus, the CBE modified its target to 7% ± 2%, given the subdued demand-driven inflationary pressures and stable food prices. On a monthly basis, inflation eased further to -0.4% in December, down from +0.8% in November and +1.8% in October.
Mona Bedeir
Senior Economist
T +202 3300 5722