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Egypt inflation quickens to highest level in years

Egypt inflation quickens to highest level in years

CAIRO, Jan 11: Egyptís annual inflation rate rose to 24.3 percent in December, official figures showed on Tuesday, two months after the government floated the pound sparking the biggest price hikes in years, reports AFP. Consumers have been hit by surging prices since November when then government floated the currency and slashed fuel subsidies as part of an economic reform package linked to a $12 billion International Monetary Fund loan. The Egyptian pound, which had been pegged at 8.83 to the dollar, was trading at more than 18 pounds to the dollar on Tuesday. The inflation rate is the highest since at least January 2011, according to central bank figures available online. Food prices rose 29.3 percent, with bread and cereal rising 54.1 percent, rice rising 77 percent, and flour rising 52.7 percent, the Central Agency for Public Mobilisation and Statistics said in a statement. Clothing and shoes prices rose 20.3 percent, while health care costs rose 33.3 percent, the bureau said. Annual inflation stood at 20.2 percent in November, the statistics bureau said. In addition to the poundís devaluation, authorities also increased tariffs on hundreds of imported items to up to 60 percent in December and introduced a value added tax in September. The IMF approved the $12 billion loan in November after Egypt saw its foreign currency reserves plunge amid political and economic turmoil since the 2011 uprising which toppled longtime president Hosni Mubarak. The tourism sector, one of the main sources of foreign currency, has been badly hit by a persistent jihadist insurgency. President Abdel Fattah al-Sisi, who led the 2013 military overthrow of Mohamed Morsi, Egyptís first elected civilian president, vowed to get the economy back on track after his election the following year.

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