Egyptian rates to stay on hold for the foreseeable future

There were no surprises from Egypt’s Central Bank today as the benchmark interest rate was left unchanged at a record low of 8.25%. With the economy still weak, and core inflation (the bank’s preferred measure) in single digits, the likelihood of a rate hike is low. However, the threat of capital outflows and dollarisation of resident accounts remains. On balance, we therefore expect that Egyptian rates will remain on hold for the foreseeable future.