Egypt's inflation peaks 5 year high of 18.7% in November due to currency devaluation

Posted on December 12, 2022   |  

In November, Egypt’s annual urban consumer inflation rate grew to a 5-year high of 18.7%, which spiked from October’s 16.2%, marking the highest rate since December 2017, when inflation reached 21.9%.

In October, the country experienced a 2nd currency devaluation this year and continuing restrictions on imports hit manufacturers and contributed to price rises.

A deficit in foreign currency led to a backlog of imports at the country's ports, leading to a shortage of imported goods and a substantial increase in their prices.

Meanwhile, import restrictions induced a shortage of foreign manufacturing components, disrupting production and threatening layoffs.

The rising inflation rate is driven by higher production costs and supply shortages, and Egypt's economy has been hit by the effects of Russia's war in Ukraine, which followed a slump caused by the Covid-19 pandemic.