October 10, 2017 / 1:40 PM / a year ago

UPDATE 1-Egypt's FY2017/18 GDP growth projected at 4.5 pct -IMF report

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CAIRO, Oct 10 (Reuters) - Egypt’s economy is projected to grow 4.5 percent in the fiscal year 2017/18, the International Monetary Fund’s World Economic Outlook report showed on Tuesday, below government projections of 5-5.25 percent.

Egypt’s average consumer price inflation for 2017/18 is projected at 21.3 percent, according to the report.

IMF Mission Chief for Egypt, Middle East and Central Asia Subir Lall said in an online briefing in September that inflation was expected to fall to “slightly above” 10 percent by the end of the fiscal year.

Finance Minister Amr El-Garhy said last month he expected inflation to drop below 15 percent by that time frame.

Import-dependent Egypt has been hit by soaring inflation since it floated its currency in November, a move which led the pound to halve in value against the dollar.

The float marked the opening salvo in a three-year, $12 billion IMF reform programme that includes tax hikes and subsidy cuts.

The reforms are designed to help revive an economy hard hit by a shortage of foreign currency and investment in the turmoil that followed the 2011 uprising that overthrew long time ruler Hosni Mubarak.

Since the float, Egypt’s central bank has raised key interest rates by a total of 700 basis points.

Egypt hopes to secure a $2 billion IMF loan payment after a second review by the Fund at the year’s end. (Reporting by Nadine Awadalla; Editing by Catherine Evans and Jon Boyle)

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