Egypt’s c. bank expected to hold interest rates

By Nada Ali On Sep 2, 2024

The Central Bank of Egypt (CBE) is widely expected to leave its interest rates unchanged at its upcoming monetary policy committee meeting on Thursday, according to a poll of analysts.

In a survey of 15 analysts, the median forecast the CBE would maintain its deposit rate at 27.25 per cent and lending rate at 28.25 per cent during the upcoming committee meeting, scheduled on Thursday, September 5.

Only one analyst projects a 100-bps rate cut.

“We anticipate interest rates being left on hold by the CBE given inflation remains well above target,” said James Swanston of Capital Economics.

“However, momentum is in the right direction and with a sharper fall anticipated in the headline rate in early 2025, attention will turn to when that first rate cut will be – for our part, we have pencilled it in for Q1 2025.” Swanston added.

Egypt’s inflation fell to 25.7 per cent in July, coinciding with the first time the real interest rate been positive since January 2022. The rate had dropped from a record 38 per cent in September to 27.5 per cent in June.

Notably, the central bank has kept rates unchanged in its last two meetings on May 23 and July 18, citing slow economic growth and a decline in inflation.

Attribution: Reuters

Subediting: Y.Yasser

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