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The Monetary Policy Committee (MPC) of Egypt decided to keep the Central Bank of Egypt’s (CBE) interest rates unchanged for the third consecutive meeting despite the global trend to raise the rates
The Monetary Policy Committee (MPC) of Egypt decided to keep the Central Bank of Egypt’s (CBE) interest rates unchanged for the third consecutive meeting despite the global trend to raise the rates. The overnight deposit rate, overnight lending rate, and the rate of the main operation remained unchanged at 11.25 percent, 12.25 percent, and 11.75 percent, respectively. The discount rate was unchanged at 11.75 percent. The required reserve ratio was increased to 18 percent from 14 percent to regulate cash flow.
The measures by the central bank are suggestive of how the country has bucked the trend through a calibrated policy, without resorting to a very tight money policy, as against the trend followed by other countries. Even the US has increased the interest rates, leading to a ripple effect among other countries.
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The annual urban inflation rates in Egypt rose from 13.6 percent in July to 14.6 percent in August. The central bank attributed the reasons for the increase to supply-side issues, particularly international commodity prices, thereby alluding that it was due to external reasons. Global inflation is ruling high because of the Ukraine war and related issues like fuel supply disruptions.
The Central Agency for Public Mobilization and Statistics (CAPMAS), announced earlier, that Egypt’s annual inflation rate rose to 15.3 percent in August 2022, compared to 6.4 percent in the same month of the previous year. In July, the annual inflation rate was recorded at 14.6 percent. The annual urban inflation rate also hiked in August to 14.6 percent, compared to 13.6 percent in July, according to the state-statistic body’s data.
