Egypt’s annual urban headline inflation eased to 14.3% in June 2026, down from 14.6% in May, as a sharp slowdown in food inflation offset continued increases in non-food prices, according to the Central Bank of Egypt (CBE).
The CBE said the moderation was primarily driven by annual food inflation, which slowed to 5.4% in June from 7.6% in May, reversing the previous seasonal increase in both core and volatile food inflation. Meanwhile, annual non-food inflation edged higher, mainly reflecting continued price increases in the services sector.
On a monthly basis, urban headline inflation recorded -0.4% in June, compared with -0.1% in June 2025 and 1.6% in May 2026.
The monthly decline was largely driven by lower food prices, with both volatile and core food inflation falling well below their historical averages. The decrease reflected lower prices for poultry, eggs and fresh vegetables, which more than offset higher non-food inflation resulting from rising rents and seasonal increases in Hajj and Umrah costs.
Annual core inflation rose slightly to 14.3% in June from 13.8% in May, mainly due to an unfavourable base effect.
Monthly core inflation slowed to 0.3% in June, compared with -0.2% in June 2025 and 1.6% in May 2026. The CBE said services remained the main contributor to monthly core inflation, outweighing the decline in core food prices.
Annual rural headline inflation also eased, falling to 10.1% in June from 11.4% in May. Consequently, annual nationwide headline inflation, which combines urban and rural inflation, decelerated to 12.2% from 13.0% over the same period.
Food prices drive monthly decline
The CBE said monthly food inflation fell by 3.2% in June, subtracting 1.19% from monthly headline inflation.
Volatile food prices declined by 8.7%, contributing -0.61%, largely reflecting a seasonal correction in vegetable prices, which dropped 14.2%, while fresh fruit prices rose modestly by 1.3%, broadly in line with historical seasonal patterns.
Core food prices fell by 2.1%, subtracting 0.58% from monthly inflation and recording their steepest monthly decline since May 2024. Unlike volatile food items, the CBE said this decline deviated from normal seasonal patterns and was mainly driven by sharp price falls in poultry (-12.5%) and eggs (-10.3%).
By contrast, monthly non-food inflation rose 1.3%, contributing 0.79% to headline inflation.
Services prices increased 2.1%, accounting for 0.62% of monthly inflation. The rise reflected higher rents following the continued pass-through of previous adjustments to the Old Rent Law, alongside seasonal increases in Hajj and Umrah costs and higher spending on restaurants and cafés.
Retail prices rose 1.1%, contributing 0.15%, driven by increases in household cleaning products, clothing and footwear, and personal care products.
Inflation for regulated items recorded 0.1% during the month, contributing 0.03%.
The CBE added that monthly core inflation of 0.3% reflected these developments, with services contributing 0.86%, retail items 0.21%, while core food prices reduced core inflation by 0.81%.
Food disinflation moderates annual inflation
Annual food inflation slowed to 5.4% in June from 7.6% in May, contributing 2.09% to annual headline inflation.
Volatile food inflation eased to 16.9% from 25.8%, contributing 1.07%, reflecting continued deflation in fresh fruit prices and slower increases in vegetable prices compared with June 2025.
Annual core food inflation also moderated to 3.4% from 4.4%, contributing 1.03%, largely due to lower poultry and egg prices compared with the same month last year.
Meanwhile, annual non-food inflation accelerated to 19.9% in June from 19.1% in May, contributing 12.21% to annual headline inflation.
Services inflation remained the largest contributor, rising to 27.5% and accounting for 7.50% of annual inflation, driven by higher rents, Hajj and Umrah costs, and spending on restaurants and cafés.
Annual inflation for regulated items stood at 13.7%, contributing 2.95%, mainly reflecting higher tobacco prices and public transport fares.
Retail inflation reached 12.1%, contributing 1.76%, supported by annual increases in clothing, personal care products, household cleaning products and vehicle prices.
Annual core inflation reached 14.3% in June, with services contributing 10.39%, retail items 2.45%, and core food 1.42%, reflecting the continued resilience of underlying inflationary pressures despite the moderation in food prices.
