Egypt: Monthly Inflation Developments - September 2017

Transcription

1. Central Bank of Egypt Monthly Inflation Developments Headline and Core Inflation – September 2017 The rate of urban CPI inflation eased for the second consecutive month in September 2017. The headline rate - published by the Central Agency for Public Mobilization and Statistics - declined to 31.59 percent (y/y) and 1.0 percent (m/m) from 31.92 percent (y/y) and 1.13 percent (m/m) in August 2017. Price increases during September were mainly witnessed in fresh vegetables, followed by regulated and some retail items. Prices of services remained roughly unchanged and core food prices declined for the first time since July 2016. As the bulk of monthly inflation was due to higher prices of volatile food and regulated items, core inflation - computed by the Central Bank of Egypt - declined to 33.26 percent (y/y) and 0.19 percent (m/m) in September from 34.86 percent (y/y) and 0.31 percent (m/m) in August.1 . Monthly Headline and Core CPI Inflation (in percent) 6 5 4 32 Headline CPI 28 Core CPI 24 2 16 1 12 0 8 -1 4 -2 0 Headline Core  Prices of fresh vegetables and fruits increased by 4.06 percent and 0.17 percent, respectively, to contribute jointly by 0.46 percentage points to monthly headline inflation. 4.4 3.4 Contributions to Monthly Headline CPI Inflation (in percent) Fruits & Vegetables Regulated Items Core CPI 2.4 1.4 0.4 -0.6 -1.6 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 Jul-17 Aug-17 Sep-17 Key Highlights CPI excl. regulated items, fruits & vegetables (74.43%) Source: CAPMAS and the CBE 1. Headline CPI2 Headline inflation in September 2017 declined for the second consecutive month to record 31.59 percent (y/y) and 1.0 percent (m/m) compared to 31.92 percent (y/y) and 1.13 percent (m/m) in August 2017. CPI - All Items (100%) Sep-12 Nov-12 Jan-13 Mar-13 May-13 Jul-13 Sep-13 Nov-13 Jan-14 Mar-14 May-14 Jul-14 Sep-14 Nov-14 Jan-15 Mar-15 May-15 Jul-15 Sep-15 Nov-15 Jan-16 Mar-16 May-16 Jul-16 Sep-16 Nov-16 Jan-17 Mar-17 May-17 Jul-17 Sep-17 20 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 Jul-17 Aug-17 Sep-17 3 Source: CAPMAS and the CBE Headline and Core CPI Inflation 1/ (year-on-year percentage change) 36 Source: CBE  Prices of regulated items rose by 2.41 percent to contribute by 0.41 percentage points to monthly headline inflation. This was mainly due to the upward adjustment of water supply and natural gas for housing prices in the context of the fiscal reform program. Prices of poultry declined for the fourth consecutive month, decreasing by 3.13 percent to contribute by negative 0.14 percentage points to monthly headline inflation. Meanwhile, prices of red meat stabilized for the first time since April 2016. 33 30 27 24 21 18 15 12 9 6 3 0 Contributions to Annual Headline CPI Inflation (in percent) Fruits & Vegetables Regulated Items Core CPI 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 Jul-17 Aug-17 Sep-17  Source: CBE 1
2. Central Bank of Egypt Monthly Inflation Developments    Prices of fish and seafood declined for the second consecutive month, decreasing by 3.50 percent to contribute by negative 0.12 percentage points to monthly headline inflation. Prices of other food items contributed by 0.02 percentage points to monthly headline inflation and reflected the decline in the price of pulses and the increase in tea prices. Prices of retail items increased by 3.39 percent to contribute by 0.37 percentage points to monthly headline inflation. This was due to higher prices of household cleaning products, stationary and school supplies, as well as personal care products. Prices of services increased slightly by 0.05 percent to contribute by 0.01 percentage points to monthly headline inflation. This was due to higher internet service prices due to the higher VAT-rate. 2. Core Inflation2 Core inflation in September 2017 declined for the second consecutive month to record 33.26 percent (y/y) and 0.19 percent (m/m) compared to 34.86 percent (y/y) and 0.31 percent (m/m) in August 2017. 36 33 30 27 24 21 18 15 12 9 6 3 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 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 Jul-17 Aug-17 Sep-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 reth placement of the 8 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 core inflation was affected by price increases of the aforementioned retail items, which contributed by 0.53 percentage points to monthly core inflation. However, this increase was partly offset by the decline of core food prices, which contributed by negative 0.35 percentage points to monthly core inflation. Meanwhile, the contribution of services was negligible. Contributions to Monthly Core CPI Inflation 6 5 4 Other Services (in percent) Paid Services Retail Prices Poultry & Red Meat Food Prices excl. Poultry & Red Meat 3 2 1 0 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 Jul-17 Aug-17 Sep-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 September basket 2/ 2016 (in percent) September 2017 (index) September 2017 to August 2017 September 2017 to September 2016 (percentage change) (January 2010 = 100) Headline - All items 100.00 192.50 253.32 1.00 31.59 39.92 232.62 328.51 0.41 41.22 Tobacco and related products 2.19 370.82 464.24 0.00 25.19 Clothing and footwear Housing, water, electricity, gas and other fuels 5.41 142.04 177.58 0.00 25.02 18.37 136.75 155.52 3.72 13.73 Furnishings, household equipment and routine maintenance of the dwelling 3.77 162.05 219.30 8.42 35.32 Medical care 6.33 172.48 209.06 0.00 21.21 Transportation 5.68 149.05 205.11 0.00 37.61 Communications 3.12 98.54 102.22 0.58 3.74 Recreation and Culture 2.43 204.76 291.57 2.14 42.40 Education 4.63 219.01 246.00 0.00 12.32 Hotels, cafes and restaurants 4.43 228.23 292.35 0.00 28.10 Miscellaneous goods and services 3.73 132.38 163.21 2.31 23.29 6.90 385.06 518.39 3.327 34.63 Regulated items 18.66 189.77 233.73 2.407 23.17 Food excl. fruits & vegetables 31.08 206.81 300.34 -0.65 45.22 Retail items 14.48 150.02 195.45 3.39 30.28 Paid services 5.87 190.28 230.81 0.00 21.30 Other services 23.00 144.90 168.28 0.05 16.13 Core CPI 74.43 175.33 233.64 0.19 33.26 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