Friday, July 22, 2011

Egyptian Central Bank Holds Deposit Rate at 8.25%

The Central Bank of Egypt maintained the overnight deposit rate static at 8.25%, and the overnight lending rate at 9.75%, while also holding the discount rate at 8.50% and the 7-day repo rate at 9.25%.  The Bank said: "the slowdown in economic growth should limit upside risks to the inflation outlook. Given the balance of risks on the inflation and GDP outlooks and the increased uncertainty at this juncture, the MPC judges that the current key CBE rates are appropriate."

Previously the Bank also maintained its interest rates unchanged when it announced policy settings in June this year.  Egypt reported annual consumer price inflation of 11.8% in June, compared to 11.9% in May, and down slightly from 12.1% in April, but up from 11.4% in March.  Core inflation rose to 8.94% in June from 8.81% in May.  The toll of the revolution was seen as Egypt's gross national product contracted by 4.2% year-on-year in the third quarter of the 2011/2012 fiscal year.


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