The world is going through a difficult period since the outbreak of the COVID-19 Pandemic in early 2020. This unique health crisis has resulted in demand and supply-side shocks, affecting both the real and financial sectors of global economies. In order to jump-start economies, governments and central banks around the world implemented expansionary fiscal and monetary policies to stimulate the economy. At the same time, supply chains are disrupted, resulting in huge increases in inflation in several countries. So, using monthly data, the study evaluates the influence of the covid-19 pandemic on inflation in Egypt using the ordinary least squares model from January 2020 to December 2021.
The findings reveal that new confirmed cases of covid-19, food prices, imports, and the producer price index all increase inflation in Egypt, while inflation is unaffected by the money supply, crude oil price volatility, or shipping costs. On the contrary new death cases of COVID-19, the stringency index, and the purchasing managers index lead to decrease inflation. As a result, the study recommends that the government provide assistance to the companies engaged in the supply chain industry to tide over the difficulties. The government must establish good offers for investors, as well as loosen some investment regulations. and the government can lessen the tax burden by enacting tax holiday policies and providing financial assistance to the manufacturing sector in order to maintain production throughout the pandemic.