Egypt inflation falls to 11.4pc over year
Cairo, May 10, 2010
Egypt's annual urban inflation rate slid to 11.4 per cent in April, its third decline this year and its lowest since September, giving the central bank more room to keep key interest rates steady.
The urban consumer price index for April was 146.4 versus 131.5 a year ago, the state statistics agency said on Monday.
Inflation was 12.2 per cent in March.
Four analysts made forecasts for urban inflation -- the most closely watched indicator of prices -- that ranged from 11.3 to 12.9 per cent. The average of the forecasts was 11.87 per cent.
Economists said urban inflation eased in April mainly due to a decline in prices of food and beverages, which account for more than 40 per cent of the weighting of the basket Egypt uses to measure inflation.
"We continue to expect headline inflation will decline in the period until July, due to the strong base effect," said Beltone Economist Reham ElDesoki, who had forecast urban inflation at 11.7 per cent.
A Reuters poll of 14 economists last month forecast inflation of 10 per cent in the financial year that begins on July 1, 2010. Several of the economists believe the central bank is unlikely to change interest rates in 2010.
The bank kept benchmark overnight interest rates on hold at its last meeting on May 6, the fifth pause since the bank began a series of rate cuts more than a year ago.
It said at the time that inflation remained within its comfort zone and interest rates were supportive of economic recovery. The bank next meets on June 17. – Reuters