Cairo, Egypt— The Central Bank of Egypt has raised the overnight interest rates by 300 basis points, exceeding expectations.
The Monetary Policy Committee (MPC) of the Central Bank of Egypt raised the overnight deposit rate, overnight lending rate, and the rate of the main operation to 16.25 percent, 17.25 percent, and 16.75 percent, respectively. The discount rate was also raised by 300 basis points to 16.75 percent.
This is the fourth time that the MPC has decided to raise key interest rates since the start of the Russia-Ukraine war in February, which triggered inflationary pressures on the Egyptian economy.
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The annual core inflation rate recorded 21.5 percent in November, up from 19 percent in October, according to the CBE.
The MPC had raised key interest rates by a total of 500 bps, in three separate moves, since the start of the war in Ukraine.
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Analysts had expected that the MPC would raise the interest rates by a maximum of 2 percent (200 bps) to reign in inflation.
The latest MPC decision comes a week after after the announcement of a new International Monetary Fund (IMF) $3 billion loan for Egypt.