Cairo — Mubasher: Egypt’s interest rate is expected to decline to 11.25% by the end of 2019, Capital Economics.
Emirates NBD Egypt Purchasing Managers’ Index (PMI) data suggest that price pressures in Egypt softened further, supporting the long-held view that “inflation and interest rates will ultimately fall by more than most anticipate,” the London-based economic research consultancy said in a report on Thursday.
The seasonally adjusted Emirates NBD Egypt PMI grew to 49.2 in November from 48.6 in October.
Egypt’s annual urban consumer price inflation registered 17.5% in October, compared with 31.8% for the same period last year.
The Central Bank of Egypt (CBE) has had to raise rates following the flotation, of the local currency in November 2016, by a combined 7%, or at 3% in November 2016, 2% in May 2017, and 2% in July 2017.
In February and March, the CBE cut interest rates by 1%, respectively.
In mid-November, the CBE’s Monetary Policy Committee (MPC) kept the interest rates unchanged. Overnight deposit rate and overnight lending rate maintained at 16.7% and 17.7%, respectively.
In the same vein, the International Monetary Fund (IMF) projected Egypt’s inflation rate to decline to 12.9% in 2019.
The North African nation's inflation rate is also expected to fall to 13.9% this year, the Washington-based fund added in a report.
