Annual inflation in Egypt hit 39.7 per cent in August, official figures showed Sunday, an all-time high for the country as it grapples with a punishing economic crisis – a country facing the consequences of market-based exchange rate formula of International Monetary Fund (IMF) as is the case with Pakistan. Earlier, it was reported that Pakistan’s inflation rate stayed above target at 27.4pc in August, as reforms set out as conditions for an IMF loan complicate the task of keeping price pressures and declines in its rupee currency in check. The latest figures in Egypt come immediately after the previous record of 38.2pc was recorded in July, and over a year into an unrelenting economic crisis that has seen the currency shed half its value against the US dollar since early last year. Food and drink prices alone registered a 71.9pc increase compared to August 2022, state statistics agency CAPMAS announced on Sunday, adding to the burden of families who have been struggling to make ends meet. The economic crisis in the import-dependent country was catalysed by Russia’s invasion of Ukraine last year, which destabilised crucial food supplies and unsettled global markets. Investors pulled billions out of Cairo’s foreign reserves, which remain buoyed by deposits from wealthy Gulf allies whose promises to purchase Egyptian state assets have fallen short of government targets. Even before the current crisis, 30pc of Egyptians were living below the poverty line, according to the World Bank, with another 30pc vulnerable to falling into poverty. Egypt, the Arab world’s most populous country, has been dependent on bailouts in recent years, from both Gulf allies and the IMF. Last year, the IMF approved a $3 billion loan for Egypt conditioned on “a permanent shift to a flexible exchange rate regime”. The country’s external debt bill has tripled over the past decade, rising to a record high of $165.4 billion this year, according to Ministry of Planning figures.