Egypt’s central bank kept interest rates unchanged on Thursday, in line with expectations, noting that inflationary pressures were easing despite slowing economic growth.
The statement said that the bank’s Monetary Policy Committee decided to keep the overnight deposit and lending rates and the central bank’s main operation rate at 27.25 percent, 28.25 percent and 27.75 percent, respectively.
The statement added that the committee also decided to keep the credit and discount rate at 27.75 percent.
This is the third time the central bank has kept interest rates unchanged since raising them by 600 basis points on March 6.
The median forecast in a poll of 15 analysts was for the central bank to keep its deposit rate unchanged at 27.25 percent and its lending rate at 28.25 percent at its next Monetary Policy Committee meeting. Only one analyst expected the central bank to cut rates by 100 basis points.
“Inflationary pressures continued to decline as the impact of previous shocks gradually receded, with annual headline inflation declining to 25.7 percent and core inflation to 24.4 percent in July 2024 for the fifth consecutive month,” the central bank said in a statement on Thursday.
The central bank statement added, “On the local side, the real GDP growth rate slowed to 2.2 percent in the first quarter of 2024, compared to about 2.3 percent in the fourth quarter of 2023.”
“The gradual decline in food inflation coupled with improved inflation expectations indicate that inflation is currently on a downward path,” the central bank said in the statement.
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