The Monetary Policy Committee of the Central Bank of Egypt (CBE) kept the overnight deposit rate and the overnight lending rate at 16.75 percent and 17.75 percent, respectively, during December’s meeting for the sixth time this year.
During the meetings of November, August, June and May, MPC also kept the interest rates unchanged after lowering them twice earlier this year by 1 percent each time.
The experts’ predicted keeping the rates on hold, amid partial stability of emerging markets and the decline of inflation during December after a witnessed rise as a result of seasonal occasions and the hike of energy prices.
Emerging markets were affected by an exit wave of foreign investments in government debt instruments during the second quarter of 2018 as the US dollar rose, raising fears from the economies of these markets, especially after the crises of Turkey and Argentina.
Foreign investments in treasury bills (T-bills) recorded LE 210.21 billion ($11.71 billion) by the end of October, compared to LE 234.52 billion ($13.06 billion) by the end of September. CBE revealed that foreign investments in T-bills in local currency declined for the seventh month in a row, losing around $1.4 billion in October, to reach its lowest levels since June 2017.
As a result of the crisis that hit the emerging markets, the outflows of foreign investments in T-bills reached around $9.8 billion during the period of April to October 2018, as the investments hit LE 380.3 billion ($21.5 billion) in March.
Egypt Today
