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Egypt May Core Inflation Tops 40%

FILE: Egyptians buy fruits at a supermarket in Cairo, Egypt, onb Sun. Feb. 26, 2023. Annual inflation reached 26.5% in January, the highest in five years, and food prices in urban areas soared 48% that month, according to official figures. May 2023's core inflation was 40.3%.

CAIRO — Egypt's annual core inflation rose to 40.3% in May from 38.6% in April, data from the central bank showed on Sunday.

Month on month, inflation increased to 2.9% in May from 1.7% in April, the data showed.

The central bank figures come after data from statistics agency CAPMAS showed on Saturday Egypt's annual urban consumer inflation rate in May accelerated to 32.7% from 30.6% in April, approaching an all-time record and higher than analysts had expected.

Month on month, urban inflation increased to 2.7% from 1.7% in April.

Inflation has risen sharply over the last year in Egypt after a series of currency devaluations, a prolonged shortage of foreign currency, and continuing delays in getting imports into the country.

Egypt has devalued its currency by half since March 2022 after the fallout from Russia's invasion of Ukraine exposed its economic vulnerabilities.

The International Monetary Fund in December approved a $3 billion Extended Fund Facility loan for Egypt, which will be disbursed over 46 months.

In its December accord with the IMF, Egypt also promised to sell state assets worth billions of dollars over the next four years.

It has made no major sales since the signing, though the central bank has raised its overnight interest rates by 500 basis points.