Egypt’s urban headline inflation rises to 13.4% in February 2026: CBE

2026-03-23 - 16:11

Annual urban headline inflation accelerated to 13.4% in February 2026, up from 11.9% in January, driven by a seasonal increase in both food and non-food prices. Annual food inflation rose to 4.6%, while non-food inflation climbed to 19.3%. Food inflation was primarily driven by higher poultry and fresh vegetable prices, in line with typical seasonal demand during Ramadan, while most other food categories remained relatively stable. Meanwhile, non-food inflation was largely attributed to an 18.7% increase in education fees, alongside an additional 8% rise in education-related goods and services. On a monthly basis, urban headline inflation rose to 2.8% in February 2026, compared with 1.2% in January and 1.4% in February 2025. The acceleration was mainly driven by higher food prices, increasing rents, rising education costs, and an official hike in tobacco prices. Annual core inflation increased to 12.7% in February, from 11.2% in January, supported by higher private education fees and core food prices. Monthly core inflation also rose to 3.0%, up from 1.2% in January and 1.6% in February 2025. Annual rural headline inflation edged up to 9.7% in February, compared with 8.4% in January. As a result, nationwide headline inflation—reflecting the average of urban and rural rates—rose to 11.5%, from 10.1% in the previous month. Key Drivers of Monthly Inflation Monthly food inflation rose to 2.8% in February, compared with 2.3% in January and 0.2% in February 2025, contributing 1.04 percentage points (p.p.) to headline inflation. This increase was largely driven by: A 2.6% rise in volatile food prices, as fresh vegetable prices increased by 5.6%, while fresh fruit prices declined by 2.1%, contributing a net 0.15 p.p. A sharp increase in poultry prices to 18.3%, following 11.6% growth in January—well above the historical February range of 5–9%—contributing 0.83 p.p. Monthly non-food inflation rose to 2.8%, up from 0.5% in January and 2.2% in February 2025, contributing 1.76 p.p. to headline inflation. Key drivers included: An 18.7% increase in education fees, alongside an 8% rise in related goods and services (including books, stationery, and uniforms), contributing 1.16 p.p. A 3.2% increase in tobacco prices following adjustments by major producers, contributing 0.19 p.p. A 2.9% rise in rents, reflecting lagged effects of previous adjustments to the Old Rent Law, contributing 0.27 p.p. Monthly core inflation stood at 3.0%, with core food items contributing 1.23 p.p., services 1.39 p.p., and retail items 0.34 p.p. Key Drivers of Annual Inflation Annual food inflation rose to 4.6% in February, from 1.9% in January, contributing 1.81 p.p. to headline inflation. This was driven by: A 16.9% increase in volatile food prices, contributing 0.95 p.p., amid fluctuations in fruit and vegetable prices throughout the year A 2.7% rise in core food inflation, contributing 0.86 p.p., reflecting higher prices for seafood, beef, and dairy products Annual non-food inflation increased to 19.3%, from 18.6% in January, contributing 11.63 p.p. to headline inflation. Key components included: Services inflation at 22.7%, contributing 6.16 p.p., reflecting the gradual easing of earlier increases in rents, dining, and transport costs Regulated prices rising by 15.1%, slightly down from 15.4% in January, contributing 3.22 p.p., as the impact of earlier fiscal consolidation measures—particularly on LPG and transport—continued to fade despite higher tobacco and public education costs Retail inflation remaining broadly stable at 15.9%, contributing 2.25 p.p., supported by relative price stability across most categories and the fading impact of earlier increases in clothing, medical products, and automotive lubricants Annual core inflation rose to 12.7%, driven primarily by services and retail components, which contributed 8.44 p.p. and 3.08 p.p., respectively, alongside a 1.17 p.p. contribution from core food.