The Central Bank of Egypt left its key overnight deposit rate unchanged at 12.25% during its January meeting, against market expectations of a 50 bps cut. Policymakers said that the decision is consistent with achieving the inflation target rate of 9% (+/- 3 percent) in the last quarter of 2020 and price stability over the medium term. Although the headline inflation picked up to a four-month high of 7.1% in December 2019, it remained within the target of 9% and mainly reflected the strong unfavorable base effect stemming from the reversal of transitory shock to prices of fresh vegetables in the previous year. The bank also noted that GDP growth stabilized to a preliminary estimate of 5.6% in 2019 Q3. The overnight lending rate and the discount rate were also kept steady at 13.25% and 12.75%, respectively. Interest Rate in Egypt averaged 11.93 percent from 1991 until 2020, reaching an all time high of 21.40 percent in October of 1991 and a record low of 8.25 percent in September of 2009. source: Central Bank of Egypt
Interest Rate in Egypt is expected to be 11.75 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate Interest Rate in Egypt to stand at 10.75 in 12 months time. In the long-term, the Egypt Interest Rate is projected to trend around 9.50 percent in 2020, according to our econometric models.