Cairo – Mubasher: The Central Bank of Egypt (CBE) is forecast to cut key interest rates by 100 basis points at its Monetary Policy Committee's (MPC) meeting next May.
The central bank is projected to slash benchmark interest rates to 14.25% in May as the country’s inflation declined, according to a recent report by Capital Economics on Tuesday.
Earlier this morning, the Central Agency for Public Mobilization and Statistics (CAPMAS) said that Egypt’s annual inflation dropped to 13.1% year-on-year in March 2018 from 32.5%.
Deposit rate is likely to decline to 13.75% by the end of this year, the report indicated, pointing that it could fall to 14.25%.
The London-based economic research consultancy noted that cutting subsidies could push inflation to hike for a month or two, expecting that the CBE would not ease the interest rates at its meeting next June until more details on subsidies cut are unveiled.
On 29 March 2018, the CBE had cut key interest rates for the second time this year by 100 basis points or 1%.
The overnight deposit and lending rates stand at 16.75% and 17.75%, respectively, while the main open market rate is reduced to 17.25%
