Egypt urban inflation eases to 12.7%, a nine-month low

Egypt urban inflation eased to an annual 12.7% in October from 13.9% in September, the lowest reading in nine months, according to figures released on 5 November by the Central Agency for Public Mobilization and Statistics (CAPMAS).

Monthly urban consumer prices rose 0.7%, slowing from 1.3% in September and from 1.8% in October 2025. The annual rate has now declined for three consecutive months, as the effect of earlier fuel and utility price increases continues to fade.

Core prices and food costs

Core inflation, which strips out volatile items and is calculated by the Central Bank of Egypt (CBE), fell to 13.1% from 14.1%, the central bank said on 9 November. On a monthly basis, however, core prices rose 1.2%, up from 0.8% in September, pointing to persistent cost pressures outside the food basket.

Annual food and beverage inflation, the heaviest component of the index, edged down to 7.1% from 7.2%, staying well below the headline rate.

Housing and utilities inflation cooled sharply to 24.5% from 35.2% as earlier tariff rises fell out of the comparison. Transport moved the other way, with annual inflation in the category quickening to 25.8% from 24.3%.

Separate nationwide figures published by CAPMAS on the same day showed headline inflation across urban and rural areas slowing to 12.0% from 12.8%, with a monthly rise of 0.6%.

What the Egypt urban inflation data means for rates

The data came a week after the CBE raised its key rates by 100 basis points on 29 October, taking the overnight deposit rate to 20% and the lending rate to 21%. It was the bank’s first hike since March 2024 and surprised analysts, who had expected rates to stay on hold. The CBE said the move was intended to keep inflation expectations anchored and protect the disinflation path amid difficult external conditions and elevated uncertainty.

The October print also came in below forecasts. JPMorgan had projected October inflation at 13.8% after the Egyptian pound slid about 7.3% against the dollar during the month, and raised its December forecast to 14.3% from 13.4%. Currency weakness and higher energy and commodity prices remain the main upside risks to the outlook.

What happens next

Before the end of the year, Egypt also needs to complete the final review of its $8bn IMF programme, which would make about $2.3bn available, ahead of the arrangement’s expiry on 15 December.

At its October meeting the CBE pushed back the timeline for reaching its 7% (±2 percentage points) inflation target to the fourth quarter of 2027. For regional investors in Egyptian debt and equities, the gap between the 20% deposit rate and 12.7% headline inflation keeps real returns firmly positive, although a renewed currency slide or further fuel-price increases could narrow that cushion quickly.

Also Read: Egypt credit rating upgraded to B3 by Moody’s

The October print follows September’s reading of 13.9%, and the CBE’s full October CPI note is available on the Central Bank of Egypt website.