Egypt’s inflation rate spikes in March amid Ukraine war

CAIRO: Egypt said on Sunday its annual inflation rate surged past 12 percent in March, up from 10 percent in February, largely because of Russia’s war in Ukraine, which has strained global markets and sent oil prices to record highs.

Data released by the Central Agency for Mobilization and Statistics shows price hikes across many sectors, from fuel, electricity and food items to housing, medical services and entertainment.

The figures cover the period from April 1, 2021, to March 30, 2022.

The hikes have inflicted a heavy burden on consumers, especially lower-income households, and particularly for everyday necessities.

Most of Egypt’s more than 103 million population have suffered from price hikes since the government embarked on an ambitious reform program in 2016 to overhaul the country’s battered economy. Nearly 30 percent of Egyptians live in poverty, according to official figures.

The figures show that food and beverage prices hiked by 4.5 percent in March compared to February prices, with price hikes for cereal and bread hitting 11 percent. 

The government announced last month fixed prices for unsubsidized bread for the next three months in an effort to fight the increase.

The accelerating hikes came in the wake of the Central Bank’s decisions to raise its main interest rate and to devalue the local currency against the U.S. dollar to fight inflation.

Justifying its March 21 decisions, the bank citied the war in Ukraine that has shaken the global economy and threatened food supplies and livelihoods of people across the world.

Brent crude, the price basis for international oil trading, was at over $102 per barrel over the weekend after hitting a peak of nearly $140 in March.