File Photo: Central Bank of Egypt building. Al-Ahram
The Monetary Policy Committee (MPC) of the Central Bank of Egypt (CBE) will convene on Thursday to review the key interest rates for the sixth time in 2021.
In the last meeting — held on 5 August — the MPC decided to maintain the CBE’s current overnight deposit rate, overnight lending rate, and the rate of the main operation at 8.25 percent, 9.25 percent, and 8.75 percent, respectively.
The discount rate was also kept unchanged at 8.75 percent.
The MPC makes its decision according to the performance of the macroeconomic indices in the domestic market and globally, particularly inflation readings.
Egypt’s annual headline inflation rate jumped to 6.4 percent in August; double the rate recorded in the same month of 2020 at 3.6 percent and the highest since December 2020, the Central Agency for Public Mobilisation and Statistics (CAPMAS) announced on Thursday.
CAPMAS attributed this hike to the increase in the prices of furniture and maintenance services by 2.6 percent, healthcare services by 2.4 percent, education by 29.7 percent, restaurants and hotels by 1.9 percent, transport by 3.5 percent, food and beverages by 7.6 percent, and the rise in other commodities and services by 9.2 percent.
On the global level, global stock markets have seen a slight decline and the dollar dropped on Tuesday in the wake of an uptick in US inflation.
The US Labour Department said on Tuesday its Consumer Price Index rose by only 0.1 percent in August, compared to an expected increase of 0.3 percent.
The figures came ahead of the US Federal Reserve (FED) meeting next week, amid the anticipated tapering of its asset purchases.