Egypt's urban consumer inflation slowed to 6.2 percent in the year to September, the state statistics agency reported on Wednesday, indicating economic activity continues to be slow despite government efforts to raise business confidence.
Prices rose 6.5 percent in the 12 months to August.
Egypt's economy was battered by more than a year and a half of political turmoil after Hosni Mubarak was toppled last year, and investors are still wary of a nation that in recent years had been a darling of frontier market investors.
The government of President Mohamed Mursi, elected in June, has been trying to draw back investors by pledging to ease the way for businesses and rein in a hefty budget deficit. It is in talks for a $4.8 billion International Monetary Fund loan.
"Egypt's headline inflation continues to slow down despite a pick-up in food inflation, suggesting that domestic activity remains slow," investment bank Beltone Financial said.
Core inflation, which strips out subsidised goods and volatile items including fruit and vegetables, fell more sharply to an annual rate of 3.84 percent in September, compared to 5.34 percent in August, the central bank reported.
Beltone noted in its report that food inflation rose to 9.3 percent year-on-year in September 2012, up from 8.2 percent a month earlier, reflecting rising global food prices.
"Inflation should start picking up again steadily until year-end as funds start flowing into Egypt and consumer confidence picks up," Beltone said.
Source: Reuters
