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CBE holds interest rates steady

CBE holds interest rates steady
The discount rate was maintained at 12.75%

Cairo – Mubasher: The Monetary Policy Committee (MPC) of the Central Bank of Egypt (CBE) decided in its meeting on Thursday to maintain the current interest rates.

The overnight deposit rate and the overnight lending rate were kept unchanged at 12.25% and 13.25%, respectively, while the rate of the main operation stabilised at 12.75%.

The discount rate was maintained at 12.75%, according to a report released by the CBE.

Annual headline urban inflation grew to 7.1% in December 2019, compared to 3.6% in November, while monthly inflation recorded -0.2% in December, compared to -3.4% in November.

“This came in line with the expectations of the Central Bank of Egypt reflecting the strong unfavourable base effect stemming from the reversal of transitory shock to prices of fresh vegetables in the previous year,” the CBE commented.

Moreover, annual core inflation registered 2.4% in December 2019, compared to 2.1% a month earlier, on the back of the increase in poultry prices.

Real GDP growth stabilised at 5.6% during the third quarter of 2019, whereas the unemployment rate rose to 7.8%

“The MPC decided that keeping key policy rates unchanged remains consistent with achieving the inflation target of 9% (±3% points) in 2020 Q4 and price stability over the medium term,” CBE said.