Money in Egypt
Egypt - Money
Central Bank leaves interest rates unchanged in January
The Central Bank of Egypt (CBE) held interest rates steady at its monetary policy meeting on 16 January, leaving the overnight deposit rate at 12.25%. This decision confounded market analysts, most of whom had been expecting another cut; in the 12 months leading up to this latest meeting, the CBE had axed interest rates by 450 basis points.
The CBE likely left rates unchanged to avoid adding immediate upward pressure to inflation, which jumped to 7.1% in December from 3.6% in November, climbing into the lower bound of the Central Bank’s Q4 CY 2020 target range of 6.0% to 12.0%. Moreover, the temporary spike in oil prices in early January following the dramatic intensification of tensions between the U.S. and Iran could have stoked concern about future oil-price induced inflation. However, economic growth appears to be slowing in Egypt and the pound has strengthened in recent months, which could ease inflationary pressures, so another interest rate cut will not be far from the minds of central bankers.
Despite January’s pause, the general trend for interest rates will likely be downward, as contained inflation should allow the CBE to make further rate cuts to bolster economic growth.
The next monetary policy meeting is set for 20 February.
Our panelists project the overnight deposit rate to end CY 2020 at 10.31% and CY 2021 at 9.78%.
Egypt - Money Data
|Money (annual variation in %)||17.0||16.4||18.6||39.3||18.4|
5 years of economic forecasts for more than 30 economic indicators.
Egypt Money Chart
Source: Central Bank of Egypt.
|Bond Yield||13.70||0.0 %||Dec 31|
|Exchange Rate||16.04||0.0 %||Jan 01|
Get a sample report showing our regional, country and commodities data and analysis.
Request a Trial
Start working with the reports used by the world’s major financial institutions, multinational enterprises & government agencies now. Click on the button below to get started.
February 15, 2020
Consumer prices increased 0.7% in January from the previous month due to higher food and beverage prices, contrasting the 0.2% month-on-month decrease in December, according to a monthly inflation note released on 15 February.
February 5, 2020
Egypt’s Purchasing Managers’ Index (PMI), which measures business activity in the non-oil private sector, dropped to 46.0 in January from 48.2 in December, indicating a worse deterioration in business conditions in the sector over the previous month and the lowest reading in over two and a half years. Contributing to the downturn in January was the fastest contraction in output among Egyptian businesses in three years, which was largely due to a sharp fall in new orders, partly due to softer export demand for the fourth consecutive month.
January 16, 2020
The Central Bank of Egypt (CBE) held interest rates steady at its monetary policy meeting on 16 January, leaving the overnight deposit rate at 12.25%.
January 9, 2020
Consumer prices decreased 0.2% in December in month-on-month terms, after decreasing 0.3% in November.
January 6, 2020
The Purchasing Managers’ Index (PMI), which measures business activity in the non-oil private sector, increased to 48.2 in December from 47.9 in November, indicating a softer deterioration in business conditions in the sector over the previous month. Supporting the PMI uptick in December were slower rates of decreases in both output and new orders.