The Central Bank of Egypt Reveals Reasons Behind Inflation Decline in February 2025
The Central Bank of Egypt announced a significant decline in the core inflation rate on both a monthly and annual basis in February 2025, indicating continued economic improvement and price stability.
On an annual basis, core inflation registered 10.0% in February 2025, down from 22.6% in January 2025, reflecting a substantial slowdown in the rise of core prices.
The central bank highlighted that the annual urban inflation rate also saw a sharp decline of 11 percentage points, reaching 12.8% in February 2025, compared to 24% in January 2025, marking its lowest level in nearly three years.
According to the bank, this decline was primarily driven by the positive base effect, along with the overall stabilization of monthly inflation trends. Similarly, the annual core inflation rate dropped significantly to 10% in February 2025, compared to 22.6% in January 2025.
Regarding the monthly core inflation rate, it remained relatively stable at 1.6% in February 2025, compared to 1.7% in January 2025, while showing a sharp decline from the 13.2% recorded in February 2024.
The monthly core inflation rate in February 2025 reflected the increase in non-food inflation, mainly due to seasonal hikes in tuition fees and school supplies, as well as rising rents and spending on restaurants and cafés, along with other non-food goods and services.
Despite its weaker contribution to the monthly inflation rate, food inflation was influenced by the seasonal impact of Ramadan, particularly affecting the prices of essential food items such as poultry.
The Central Bank further noted that the monthly urban inflation rate recorded 1.4% in February 2025, compared to 11.4% in February 2024 and 1.5% in January 2025.
In addition to higher non-food and essential food prices, the monthly urban inflation rate was also influenced by increased prices of administered goods and services, such as tobacco products and public education tuition fees, alongside the unexpected decline in fresh vegetable prices, contrary to their usual seasonal pattern.
