Egypt cbank leaves main interest rates unchanged

CAIRO, Oct 29, (RTRS): Egypt’s central bank kept its benchmark interest rates on hold at a monetary policy meeting on Thursday as it balanced the need to keep inflation in check and the need to stimulate the economy, the central bank said in a statement.

The monetary policy committee (MPC) left the overnight deposit rate at 8.75 percent and the overnight lending rate at 9.75 percent, it said in a statement.

“The MPC judges that the key central bank of Egypt rates are currently appropriate give the balance of risks surrounding inflation and gross domestic product outlooks,” the bank said.

Five economists surveyed by Reuters had all said they expected the bank to keep rates on hold.

Inflation in Egypt had slowed for three consecutive months but accelerated again in September, reaching 9.2 percent compared with 7.9 percent in August. Core inflation eased to 5.55 percent in September from 5.61 percent in August.

It was the last MPC meeting to be held under central bank governor Hesham Ramez, who is due to be replaced by banker Tarek Amer on Nov 26.

In September the bank kept rates on hold for the fifth straight time, after it surprised the market with a 50-basis point cut in January.

Egypt has been struggling with slow economic growth since autocrat Hosni Mubarak was toppled in 2011, giving way to a period of political instability and deterring tourists and investors from Egypt.

The government expects the economy to grow by 5 percent this year, although economists say it would be around 4.2 percent. Growth last year was about 4.2 percent.