Cairo – Mubasher: Fuel prices in Egypt are expected to rise by an average of 20.6% as the government is close to fully cover the cost of petroleum products, compared to an average increase of 47.2% in June 2018.
The country’s inflation rate is likely to increase by a range between 2.5% and 3.5% while implementing the automatic price indexation mechanism in the third quarter of 2019, Beltone Financial Holding’s research department said in a report.
Beltone also projected the Central Bank of Egypt (CBE) to cut interest rates by 100 basis points in the Monetary Policy Committee’s (MPC) next meeting on 23 May based on inflation rates over the past two months.
The CBE is likely to slash interest rates by 100 basis points by the end of the year, the company indicated.
Furthermore, the company noted that the price of 95-octane fuel has fallen even though oil prices jumped by 11% as the Egyptian pound exchange rate against the US dollar rose by 2% in Q1-19.
The Egyptian petroleum ministry has maintained the price of 95-octane fuel at EGP 7.75 per litre through the second quarter of 2019 following the indexation mechanism committee’s meeting on Sunday.
The government had introduced the automatic price indexation mechanism in December 2018 within the framework of the state’s economic reform programme.
