Egypt central bank expected to keep interest rates fixed, Poll

Egypt’s Central Bank is likely to maintain interest rates this week, despite inflation drop to an eight-month low in July according to a Reuters poll

Nine analysts of 11 forecast that the central bank would leave rates unchanged at its regular monetary policy committee meeting on Thursday. Two dissenting analysts forecast a 50 basis points cut.

Some analysts expected the central bank to lower rates to boost economic growth, bogged down by the spread of coronavirus earlier this year.

“Any cut will not be very useful for the economy at the current time, especially with the existence of many lending initiatives,” said Aboubakr Emam of Prime Holding.

The overnight lending rate is currently 10.25% and the overnight deposit rate 9.25%, the lowest rates since early 2016, before Egypt embarked on a three-year, IMF-backed economic reform programme.