Egypt’s central bank looks through inflation spike

The decision by Egypt’s central bank to leave its policy interest rate on hold despite the rise in inflation to a 30-year high last month means that additional monetary tightening is no longer on the cards. We have taken the 150bp of rate hikes that we had previously expected out of our profile. The next move in interest rates will be down, with Q4 of this year the most likely time for the first cut.