Annual urban consumer inflation is forecast to slow to 32.5% in January from 33.7% in December, according to the median forecast of 18 analysts polled.
Inflation has been coming down steadily from a record high of 38.0% in September.
"We expect annual inflation (urban CPI) to drop further, solely on account of the favorable base year impact (of -5.4%), while monthly inflation is estimated to have intensified," Allen Sandeep of Naeem Brokerage wrote in a note.
The government in January increased the price of Cairo metro tickets by up to 20%, internet services by as much as 33% and electricity prices by as much as 26%.
Analysts said Egypt could expect inflation to reignite in coming months, particularly if the government, as widely expected, devalues the Egyptian pound.
"The inflation outlook in Egypt is highly uncertain, and will hinge largely on the extent of any devaluation of the official pound rate in the coming weeks or months," Farouk Soussa of Goldman Sachs wrote.
The currency has been fixed at 30.85 pounds to the dollar since March but has weakened to about 60 on the black market.
Still, some analysts expect inflation to rise in January, in part because of the recent price increases and because of domestic certificates of deposit worth hundreds of millions of pounds that matured in January, flooding the market with liquidity.
"We forecast January's annual headline inflation to increase by 6.7% month-on-month and 36.3% year-on-year," wrote Heba Mounir of HC Securities.
A median of five of the analysts surveyed expected core inflation, which excludes fuel and some volatile food items, to slow to 31.9% in January from 34.2% in December.
The state statistics agency CAPMAS and the central bank are expected to release January inflation data on Thursday.
(Polling by Milounee Purohit and Anant Chandak; Writing by Patrick Werr; Editing by Christina Fincher)
