Inflation data released by CAPMAS showed that annual urban inflation, once again, surprisingly fell from 9.4% in June to a an even lower single-digit reading in July of 8.7%. Meanwhile, monthly urban inflation accelerated from –0.8% in June to 1.8%. The same pattern was observed in total republic inflation which dropped from 8.9% in June to 7.8% in July, with monthly inflation accelerating from –1% in June to 1.5% in July. Annual core inflation, in turn, decelerated from 6.4% in June to 5.9% in July, and retreated on monthly basis from 0.27% to 0.11%. Overall, we see inflation figures as another factor supporting an interest rate cut soon, most probably in the upcoming MPC meeting on 22 August 2019.
For more details, please read the full report below.