Egypt: Monthly Inflation Developments - June 2017

Transcription

1. Central Bank of Egypt Monthly Inflation Developments Headline and Core Inflation – June 2017 Headline urban CPI inflation – published by the Central Agency for Public Mobilization and Statistics on July 10, 2017 – dropped to 0.82 percent in June 2017 from 1.67 percent (m/m) in May. The annual rate remained broadly unchanged in June 2017, recording 29.76 percent compared to 29.71 percent in May, supported by a favorable base effect. Monthly inflation was mainly driven by higher prices of core food items and by a lesser extent retail items, particularly clothing which coincided with Eid-El-Fitr. In the meantime, price increases were partially offset by the negative contribution of fresh vegetables for the first time since December 2016. Given that price increases were mainly in core items, core inflation computed by the Central Bank of Egypt registered 1.80 percent (m/m) in June 2017 compared to 1.99 percent (m/m) 1 in May. Meanwhile, annual core inflation recorded 31.95 percent in June 2017 compared to 30.57 percent in May. . 6 Monthly Headline and Core CPI Inflation (in percent) 5 Headline CPI 4 Core CPI 28 Headline 24 Core 16 1 12 0 8 -1 4 -2 0 1. Headline CPI2 Headline CPI inflation dropped to 0.82 percent (m/m) in June 2017 from 1.67 percent (m/m) in May. The annual rate remained broadly unchanged, recording 29.76 percent in June 2017 compared to 29.71 percent in May, supported by a favorable base effect. 4.4 0.4  Prices of milk and eggs increased by 6.96 and 13.87 percent, respectively. Together they contributed by 0.44 percentage points to monthly headline inflation. Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Source: CBE Contributions to Annual Headline CPI Inflation (in percent) 32.0 30.0 28.0 26.0 24.0 22.0 20.0 18.0 16.0 14.0 12.0 10.0 8.0 6.0 4.0 2.0 0.0 Fruits & Vegetables Regulated Items Core CPI Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Prices of fish and seafood declined by 1.03 percent to contribute by negative 0.04 percentage points to monthly headline inflation. Core CPI 1.4 -1.6  Fruits & Vegetables 2.4  Prices of red meat continued to increase, growing by 3.04 percent in June 2017, while prices of poultry decreased by 1.81 percent. Both contributed jointly by 0.16 percentage points to monthly headline inflation. Contributions to Monthly Headline CPI Inflation (in percent) Regulated Items 3.4 -0.6  CPI excl. regulated items, fruits & vegetables (74.43%) Source: CAPMAS and the CBE Key Highlights Prices of fresh vegetables decreased by 4.63 percent while prices of fresh fruits increased by 3.79 percent. Together they contributed by negative 0.43 percentage points to monthly headline inflation. CPI - All Items (100%) Jun-12 Aug-12 Oct-12 Dec-12 Feb-13 Apr-13 Jun-13 Aug-13 Oct-13 Dec-13 Feb-14 Apr-14 Jun-14 Aug-14 Oct-14 Dec-14 Feb-15 Apr-15 Jun-15 Aug-15 Oct-15 Dec-15 Feb-16 Apr-16 Jun-16 Aug-16 Oct-16 Dec-16 Feb-17 Apr-17 Jun-17 20 2 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 3 Source: CAPMAS and CBE Headline and Core CPI Inflation 1/ (year-on-year percentage change) 32 Source: CBE 1
2. Central Bank of Egypt Monthly Inflation Developments Prices of other food items including rice , fats, bakery products, pulses, processed meat and sweets picked up to contribute jointly by 0.16 percentage points to monthly headline inflation.  Prices of retail items rose notably for the first time since February 2017 by 4.08 percent to contribute by 0.45 percentage points to monthly headline inflation. This was mainly due to higher prices of clothing and footwear, which coincided with Eid-ElFitr.  While prices of paid services remained unchanged, prices of other services increased slightly to contribute by 0.08 percentage points to monthly headline inflation. The increase was driven by pilgrimage as well as restaurants services. 2. Core Inflation2 Core CPI inflation computed by the Central Bank of Egypt recorded 1.80 percent (m/m) in June 2017 compared to 1.99 percent (m/m) in May. The annual rate registered 31.95 percent in June 2017 compared to 30.57 percent in May. 34 32 30 28 26 24 22 20 18 16 14 12 10 8 6 4 2 0 Contributions to Annual Core CPI Inflation (in percent) Other Services Paid Services Retail Prices Poultry & Red Meat Prices Food Prices excl. Poultry and Red Meat Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17  Source: CBE 1/ CAPMAS publishes three CPI series: (1) the CPI for urban areas which include Cairo, Alexandria, urban Lower Egypt, urban Upper Egypt, Canal cities and Frontier governorates, (2) the CPI for rural areas, and (3) the CPI for All areas. Numbers quoted in this note refer to CPI-Urban. 2/ It is important to underscore that the monthly percentage changes of both headline and core CPI between September 2009 and July 2010 do not match rates of changes presented in previous inflation notes given the replacement of the 8th CPI series by the 9th series starting from August 2009 (Full details are discussed in the Technical Appendix of the August 2010 Inflation Note). Monthly price dynamics were mainly driven by previously mentioned core food items, which contributed by 1.03 percentage points to monthly core inflation. This came in addition to the increase in the prices of retail items and other services, which contributed by 0.64 and 0.12 percentage points to monthly core inflation, respectively. Contributions to Monthly Core CPI Inflation 6 5 4 (in percent) Other Services Paid Services Retail Prices Poultry & Red Meat Food Prices excl. Poultry & Red Meat 3 2 1 0 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 -1 Source: CBE 2
3. Central Bank of Egypt Monthly Inflation Developments Table 1 . Classification of All Items included in Core CPI Food Retail Paid Services Other Services Bread and cereals Meat Fish and other seafood Eggs & Dairy products Oils and fats Clothing Fabrics Footwear Products related to dwelling repairement Furniture Tailors, laundry & shoe repair Dwelling maintenance services Portman & gardener's services Cook & maid's services Technicians to HH appliances Rentals (new law) Rental value of owner occupied housing Hospital services Transportation Services Mobile & internet services Dried fruits Carpets and other floor covering Repairs of Audio-visual equipment Recreational & sporting services Processed vegetables Pulses Sugar and confectionery Other food products Beverages Household (HH) textiles HH appliances Glassware, tableware and HH utensils HH small tools & supplies HH cleaning products HH miscellaneous products Purchase of vehicles Spare parts Motor oil Telephone & telefax equipment Home entertainment equipment Recreational equipment Personal care supplies and products Personal effects Books School supplies Medical care goods Physicians Mechanics Teachers Hairdressers Cultural services Hajj & Omra trips Restaurants and Cafes Accommodation services Private schools 3
4. Central Bank of Egypt Monthly Inflation Developments Table 2 . Consumer Price Index and Major Components 1/ Weight in basket 2/ (in percent) June 2016 June 2017 (index) June 2017 to May2017 June 2017 to June 2016 (percentage change) (January 2010 = 100) Headline - All items 100.00 185.16 240.27 0.82 29.76 39.92 225.12 315.82 0.55 40.29 Tobacco and related products 2.19 320.79 429.47 0.00 33.88 Clothing and footwear Housing, water, electricity, gas and other fuels 5.41 135.68 175.97 12.14 29.69 18.37 130.82 140.89 0.00 7.70 Furnishings, household equipment and routine maintenance of the dwelling 3.77 157.68 202.14 0.32 28.20 Medical care 6.33 172.48 194.31 0.00 12.66 Transportation 5.68 144.24 181.58 0.02 25.88 Communications 3.12 96.88 98.59 0.00 1.77 Recreation and Culture 2.43 190.63 282.69 1.91 48.29 Education 4.63 219.01 246.00 0.00 12.32 Hotels, cafes and restaurants 4.43 215.41 268.15 0.54 24.48 Miscellaneous goods and services 3.73 121.14 159.81 0.19 31.92 6.90 354.07 476.80 -3.01 34.66 Regulated items 18.66 177.38 208.83 0.00 17.73 Food excl. fruits & vegetables 31.08 204.06 293.28 1.91 43.72 Retail items 14.48 144.05 187.70 4.08 30.30 Paid services 5.87 185.84 215.04 0.00 15.71 Other services 23.00 140.94 162.69 0.52 15.43 Core CPI 74.43 171.44 226.22 1.80 31.95 Food and beverages Selective aggregates Fruits & vegetables 3/ 1/ Source: CAPMAS and CBE calculations 2/ Based on 2008/2009 Household Expenditure Survey 3/ Excluding pulses, processed vegetables and dried fruits 4