Cairo – Mubasher: HC Research expects the Central Bank of Egypt (CBE) to keep interest rates unchanged in its meeting on Thursday, 20 February.

Although inflation rates accelerated in January, they are within the CBE’s target range of 9% plus or minus three percentage points by the fourth quarter of 2020, according to a report released by the research department of HC Brokerage, an affiliate of HC Securities & Investment, on Tuesday.

Egypt's Inflation rate is forecast to record an average rate of 5.6% over the February-May period and 8.9% over the June-December period on the back of seasonality.

Monette Doss, chief economist and financial analyst at HC Securities, forecasts the CBE to maintain interest rates unchanged in its meeting next Thursday before going back to monetary policy easing in April.

Expectations for maintaining interest rates are based on the reduction in unofficial foreign exchange reserves which slipped to $4.41 billion in January, its lowest level in two years, from $7.57 billion in December 2019, due to the repayment of foreign debt.

Doss further noted that Egypt’s real interest rate is expected to stand at 3.59% for the coming 12 months.