Egypt CPI: Downward surprise in July: CBE to remain on HOLD in August

Research evidence excerpt

J P M O R G A N

Africa Economic Research

10 August 2026

Egypt CPI: Downward surprise in

July

CBE to remain on HOLD in August

July CPI rose by 14.9%oya from 14.3% in June but lower than consensus

(15.6%oya) and JPMe (15.9%oya)

EM, Economic and Policy Research

Momentum was softer across the board, but food and rents drove the

largest downside

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Our profile is lower for the year but risk bias remains skewed towards

further adjustments to regulated prices

We expect the CBE to remain on HOLD in August and through year-end

Food and rents provide the largest downside surprise but CBE will yet remain

on HOLD. July headline CPI rose to 14.9% oya (from 14.3% in June), but

undershot both consensus (15.6%) and our forecast (15.9%). The miss was driven

by broad-based momentum cooling, led by food and rents. Food prices fell 0.6%

m/m (vs -3.2% in June), versus our expectation for a +0.6% rise, while housing and

utilities increased only 0.7% m/m (from 2.0%) versus our 2.1% call. Rent

momentum also moderated sharply: actual and imputed rents rose 0.8% m/m and

0.9% m/m, respectively, well below the prior three-month averages of 3.7% and

4.0%. The July surprise lowers our FY26/27 average inflation forecast by 0.6%-pts

to 13.1% oya, with end-2026 inflation now seen at 14.7% oya. Even so, we expect

the CBE to remain cautious with limited room to ease, and keep the deposit rate

unchanged at 19% through 1Q27.

Figure 1: Egypt CPI rent prices

%m/m

17.5

15.0

12.5

10.0

7.5

5.0

2.5

0.0

Actual

Imputed

Source: CAPMAS, J.P. Morgan

Softer momentum across the board in July. On a month-on-month basis, the

headline index was flat in July after a -0.4% m/m decline in June, with broadly

softer momentum across most components. Food deflation was driven by fruits

and vegetables (-0.5% m/m) and meat (-2.2% m/m), while cooler rent dynamics

contributed to the slower rise in housing and utilities. Core segments also eased:

furnishings and household equipment rose 1.6% m/m (from 3.3% in June),

recreation fell 2.4% m/m (from +7.5%), and restaurants and hotels declined 0.4%

m/m (from +1.0%). Overall, core inflation was flat m/m from +0.3% recorded in

June (Table 1)