Egypt’s inflation rate almost halves in February

Egypt’s annual inflation rate fell to 12.5% in February, down from 23.2% in January, as the country recovers from its worst economic crisis, AFP reports. Economists attribute the sharp drop mainly to base effects—where current figures are compared to last year’s exceptionally high rate of 36%, making the decline appear more pronounced. 

Despite easing inflation, Egyptians continue to struggle with rising prices and declining purchasing power. Since February 2022, the Egyptian pound has lost over 60% of its value, and inflation peaked at nearly 40% in August 2023.

Following a March 2024 currency devaluation, Cairo secured over $50 billion in loans and investments from the IMF, World Bank, and UAE. The IMF is set to review Egypt’s program, with plans to approve a new $1.2 billion tranche. 

Economic pressures persist, exacerbated by attacks on Red Sea shipping lanes, which have slashed Suez Canal revenues by over 70%, further straining Egypt’s foreign currency reserves.