The Monetary Policy Committee (MPC) of the Central Bank of Egypt (CBE) decided in its meeting on Thursday to maintain the current interest rates unchanged.
Overnight deposit rate, overnight lending rate, and the rate of the main operation stood at 15.75%, 16.75%, and 16.25%, respectively, while the discount rate was kept unchanged at 16.25%, the CBE said in a statement.
“Annual headline and core inflation declined to 13% and 8.1% in April 2019 from 14.2% and 8.9% in March 2019, respectively. This decline was supported by favourable base effects and a lower contribution from food prices, while the contribution of nonfood prices remained broadly unchanged,” the bank added.
Real GDP growth went up to 5.6% in the first quarter of the year, compared to 5.5% a quarter earlier, while the unemployment rate declined to 8.1% in Q1-19 from 8.9% in Q4-18, the CBE’s data showed.
The bank noted that net external demand continued to support economic activity, while private domestic demand was limited, adding that the global economic growth slowed down and the trade tensions weighed on the global outlook.
“Meanwhile, international oil prices continued to increase since the beginning of 2019 and remain subject to volatility due to geopolitical risks and potential supply-side factors, which pose risks to the domestic inflation outlook,” the CBE said.
The Egyptian finance ministry is targeting a primary surplus of 2% of GDP in the fiscal year 2018/2019.