Egypt inflation has peaked, governor says

Egyptian central bank Gov. Tarek Amer said inflation in the most populous Arab country has peaked after policymakers responded to the surge in prices by raising borrowing costs to the highest level in more than a decade. “We are in the right direction and we are moving very fast,” Amer said in an interview with Bloomberg TV in Dubai Monday. “We’ve been aggressive in our monetary policy, and this has been resisted a bit. But we thought it’s important so we can get our shop fixed very quickly.”

Egypt in November became the first Arab country to liberalize the exchange rate as part of a sweeping program to restore investor confidence in an economy battered by years of unrest. The government also reduced fuel and electricity subsidies, steps that past administrations had balked at to avoid stoking social unrest. The plan helped secure a $12 billion IMF program in November and encouraged investors to pour about $16 billion into local-currency debt, attracted by one of the world’s highest yields.