Egypt’s inflation rate declined in March as food prices, one of the causes of the unrest that toppled President Hosni Mubarak, rose at a slower pace.
The annual inflation rate in urban parts of Egypt, the gauge the central bank monitors, fell to 9 percent from 9.2 percent in February, the official statistics agency said on its website today. Prices rose 1.2 percent in the month. Food and beverage costs, the biggest component of the consumer-price index, increased 10.9 percent from a year earlier, compared with 12.6 percent in February, it said.
The deceleration is “mainly driven by base effects,” Mohamed Abu Basha, a Cairo-based economist at EFG-Hermes Holding SAE, the biggest publicly traded Arab investment bank, said in an e-mailed response to questions before the figures were published.
Egypt’s economy contracted in 2011 as political instability deterred investment and tourism. The country has requested a $3.2 billion loan from the International Monetary Fund as it seeks to end the erosion of foreign-currency reserves and revive growth.
Core inflation accelerated to an annual 8.68 percent in March from 7.3 percent in February, the central bank said on its website today.
The central bank has left its benchmark overnight deposit rate unchanged at 9.25 percent this year, after a 1 percentage-point increase in November as it sought to avert a run on the currency, according to some economists.