Egypt’s annual headline urban inflation increased to 36.5% in July 2023 up from 35.7% in June 2023. Given the relative stability in annual non-food inflation, the acceleration in annual headline inflation continued to be mainly driven by higher prices of food items.
In July 2023, annual food inflation continued with its upward trend to record 68.4% up from 65.9% in June 2023. In addition, annual non-food inflation remains stable, as it recorded 21.0% in July 2023 compared to 20.9% in June 2023.
Annual core inflation witnessed a slight slowdown, as it recorded 40.7% in July 2023 from 41.0% in June 2023. This comes in line with monthly core inflation registering 1.3% in July 2023 compared to 1.5% during the same month last year.
Monthly headline urban inflation recorded 1.9% in July 2023 compared to 1.3% during the same month last year.
Monthly food inflation increased to reflect broadly equal contribution of volatile and core food. The seasonal impact of fresh fruits and vegetables was exacerbated by the adverse weather conditions driving up their prices.
Core food prices reflected higher prices of eggs, dairy products, red meat, poultry, among others.
Meanwhile, non-Food inflation reflected the fourth consecutive monthly increase in tobacco prices and broad-based increases in services and retail items.
Rural annual inflation increased to record 40.0% in July 2023 from 37.8% in June 2023.
Additionally, annual inflation for the whole country increased to 38.2% in July 2023 from 36.8% in June 2023.
Prices of fresh fruits and vegetables increased by 9.6% and 5.8%, respectively. Together, they contributed by 0.37% to monthly headline inflation. This comes as adverse weather conditions amplified the seasonal pattern of crop prices; mainly reflected on the prices of onions, citrus fruits and potatoes.
Prices of eggs and dairy products increased by 7.6% and 2.5%, respectively, to contribute by 0.23% to monthly headline inflation.
Prices of red meat and poultry continued to slightly increase, to record a monthly inflation of 0.9% and 0.7%, respectively. They both contributed by 0.10% to monthly headline inflation.
On the other hand, prices of market rice witnessed a decline by 2.8%, to register a contribution of negative 0.05% to monthly headline inflation.
Prices of other core food items including fish & seafood, market sugar and tea, among others, increased to contribute by 0.14% to monthly headline inflation.
Prices of regulated items increased by 2.5%, to contribute by 0.51% to monthly headline inflation. This was mainly due to increases in tobacco prices, medical products and public hospitals.
Prices of services increased by 1.1% to contribute by 0.31% to monthly headline inflation. This was primarily driven by higher expenditure on restaurants and cafes, rents, haircuts, and outpatient services.
Prices of retail items increased by 2.0%, contributing by 0.26% to monthly headline inflation. This was mainly owing to an increase in prices of medical products, personal care products, household appliances and cleaning products as well as purchase of vehicles.
Monthly core inflation was affected by price changes of the aforementioned core CPI items. Core food items, services, and retail items contributed by 0.56, 0.41, and 0.35% to monthly core inflation, respectively.