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Egypt keeps interest rates unchanged on inflation risks

The Central Bank of Egypt (CBE) retains interest rate on fears of inflation increase and economic slowdown

Ahram Online, Monday 1 Sep 2014
People and vehicles are seen caught in a traffic jam in front of the Central Bank of Egypt's headquarters in downtown Cairo March 17, 2013 (Photo: Reuters)
Egypt's central bank kept the overnight deposit rate, overnight lending rate and the rate of the bank's main operation unchanged at 9.25 percent, 10.25 percent and 9.75 percent, respectively.
The central bank raised its key interest rates in July to contain inflation, which went up on the back of price increases on subsidised fuel and electricity.
The bank said in a press release that "higher than anticipated indirect and second round effects of the price adjust pose an upside risk to the inflation outlook."
It added that though economic growth slightly picked up in the third quarter of the financial year 2013/14 to 2.5 percent, growth rate during the first nine months of the same year (July 2013-March 2014) inched down to 1.65 percent, compared to 2.31 percent during the same period of the previous year.
The central bank expressed its worries that the "risks surrounding global recovery" would negatively affect Egypt's economic growth.
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