Egypt's Inflation in Lowest Rate since Floating Currency

Sellers and shoppers in Sooq El Atba, Cairo. Reuters
Sellers and shoppers in Sooq El Atba, Cairo. Reuters
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Egypt's Inflation in Lowest Rate since Floating Currency

Sellers and shoppers in Sooq El Atba, Cairo. Reuters
Sellers and shoppers in Sooq El Atba, Cairo. Reuters

Annual urban inflation fell to 21.9 percent in December from 26 percent the previous month for the first time since November 2016 when the currency was floated, the official statistics agency, CAPMAS, said on Wednesday.

Egypt decided in 2016 to fully float its local currency, which lost half its value in a country that relies heavily on imports.

“We expect inflation to continue its decline until it reaches around 12 percent mid this year,” said Reham El Desoki, senior economist at Arqaam Capital.

Inflation has climbed since Egypt floated its currency, the pound, in November 2016, reaching a record high of 35.3 percent in July after energy subsidies were cut. It has gradually eased since July. Urban consumer price inflation month-on-month rate fell to -0.2 percent, in Dec 2015, from 1 percent in November.

Egypt’s inflation is expected to fall below 20 percent next month and to 10-12 percent during 2018, said Finance Minister Amr El Garhy.

The World Bank forecast Tuesday Egypt’s economy to grow 4.9 percent in 2018, compared to 4.4 percent in 2017, becoming the second highest growing economy in MENA after Djibouti (expected growth of 7 percent).

In January 2018, in the Global Economic Prospects report about MENA, the World Bank said that Egypt’s economy would grow 5.6 percent in 2019 while growth in the MENA is expected to jump to 3 percent in 2018 and 3.2 percent in 2019.



Gazprom, CNPC Discuss Future Russian Gas Supplies to China

A view shows a board with the logo of Russian gas producer Gazprom at the St. Petersburg International Economic Forum (SPIEF) in Saint Petersburg, Russia June 5, 2024. REUTERS/Anton Vaganov/File Photo
A view shows a board with the logo of Russian gas producer Gazprom at the St. Petersburg International Economic Forum (SPIEF) in Saint Petersburg, Russia June 5, 2024. REUTERS/Anton Vaganov/File Photo
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Gazprom, CNPC Discuss Future Russian Gas Supplies to China

A view shows a board with the logo of Russian gas producer Gazprom at the St. Petersburg International Economic Forum (SPIEF) in Saint Petersburg, Russia June 5, 2024. REUTERS/Anton Vaganov/File Photo
A view shows a board with the logo of Russian gas producer Gazprom at the St. Petersburg International Economic Forum (SPIEF) in Saint Petersburg, Russia June 5, 2024. REUTERS/Anton Vaganov/File Photo

The heads of Russia's Gazprom and China's energy company CNPC discussed future Russian gas supplies to China during talks in Beijing, Gazprom said on Friday, as Moscow seeks stronger ties with the world's biggest energy consumer.

Russia, the holder of world's largest gas reserves, has diverted oil supplies from Europe to India and China since the start of the conflict in Ukraine in February 2022, Reuters said.

At the same time, Russia's diversification of pipeline natural gas from the European Union has been slow.

It started gas exports to China via the Power of Siberia pipeline in the end of 2019 and plans to reach the pipeline's annual exporting capacity of 38 billion cubic meters this year.

Russia and China have also agreed on exports of 10 bcm of gas from Russia's Pacific island of Sakhalin starting from 2027.

However, years of talks about the Power of Siberia 2 pipeline, which would ship 50 bcm of gas per year to China via Mongolia, have yet to be concluded as the two sides disagree over issues such as the gas price.

Russian President Vladimir Putin is set to travel to China in early September to participate in celebrations marking the anniversary of the victory over Japan in World War II.

The trip follows Chinese President Xi Jinping's visit to Moscow in May.