Egypt Central Bank to Review Interest Rates Today

The Central Bank of Egypt (CBE) will convene its monetary policy committee today to look into interest rates. This will be the last meeting for 2013.

Bankers have different views whether the CBE will keep, hike or cut the interest rates.

Some experts see that the CBE will keep the overnight deposit rate and overnight lending rate unchanged at 8.75% and 9.75%,respectively. On the other hand, other experts are expecting the CBE will lower the interest rates by 25-50bps, with the aim of providing more incentives for the foreign investors.

In its meeting held on Thursday, October 31, 2013, CBE decided to keep the overnight deposit rate, overnight lending rate, and the rate of the CBE’s main operation unchanged at 8.75%, 9.75%, and 9.25% respectively. The discount rate was also kept unchanged at 9.25%.
This move came after the central bank cut interest rates twice. On September 19, the MPC made a second policy cut in row by 50bps. Overnight deposit rate reached 8.75% while overnight lending rate reached 9.75%. On August 1, the central bank unexpectedly lowered its main overnight interest rate by 50bps, saying it was more concerned about boosting growth than taming resurgent inflation. The discount rate was also cut by 50bps to 9.75%.