CAIRO, Dec 8 (Aswat Masriya) - Egypt's annual urban consumer price inflation jumped to 19.4 per cent in November, compared to 13.6 per cent in October, according to the state-run Central Agency for Public Mobilisation and Statistics report.
Egypt’s central bank had decided in the first week of November to abandon its peg of 8.8 pounds to the US dollar and announced the floatation of the currency. The pound currently stands at around 18 against the dollar.
The floatation, as well as applying the value-added tax in September and lifting fuel subsidies in November, helped Egypt secure a $12 million loan from the International Monetary Fund.
The recent measures led to a wave of price increases that highly affected the prices of food and transportation.
Prices are expected to further increase as Egypt imposed last week an increase on customs duties of 320 goods, with tariffs reaching 60 per cent for many items. The decision aims to encourage domestic production and reduce imports, according to the finance ministry.
Earlier this week, the Emirates NBD Egypt Purchasing Managers' Index showed that Egypt’s non-oil business activity shrank in November to a 40-month low.
Finance minister Amr El-Garhy said mid-November that Egypt is seeking to reduce inflation to below 10 per cent by 2018/19.
The cash-strapped Egyptian government is currently facing the consequences of years of political turmoil triggered by the 2011 Uprising that toppled former president Hosni Mubarak, halving the country’s foreign reserves and scaring away tourists and investors.