The Central Bank of Egypt’s (CBE) Monetary Policy Committee (MPC) decided to keep key interest rates unchanged for the second consecutive meeting, according to a press release on November 2nd.

The overnight deposit rate and the overnight lending rate remained the same at 19.25% and 20.25%, respectively.

Additionally, the rate of the main operation was kept unchanged at 19.75% and the discount rate was also left unchanged at 19.75%.

“On the global front, forecasts for key international commodity prices, particularly energy, have been revised upwards compared to the forecasts underlying the previous meeting, mainly due to rising geopolitical tensions in the region,” the release noted.

“Nonetheless, inflationary pressures have eased worldwide as a result of monetary policy tightening cycles in major economies, as well as favourable base effects,” it added.

The MPC restates that projected inflation, not actual inflation rates, will continue to determine the path of future policy rates, and it will continue to assess the relative importance of the various risks associated with the inflation outlook.

The MPC also confirmed that it would continue keeping an eye on all new developments that may affect the outlook for the economy.

The MPC will not hold back from using all of its available tools, including liquidity management operations, to maintain a tight monetary policy and attain the CBE’s upcoming inflation targets of 7% on average by the fourth quarter (Q4) of 2024 and 5% on average by Q4 2026.

It is worth mentioning that Egypt's annual headline inflation rose to 38% in September, compared to 15% in the same month of 2022.