HC Securities and Investment expects the Central Bank of Egypt’s (CBE) Monetary Policy Committee (MPC) to cut interest rates by 100 basis points (bps) during its meeting next Thursday.
As the North African nation’s headline inflation continues to decline for the third successive month from its high level of 14.1% in May, the CBE is forecast “to proceed with monetary easing to stimulate economic growth and stock market activity,” HC Securities and Investment said in a statement.
Egypt’s annual inflation fell below 9% year-on-year to meet the CBE’s target of 9% plus or minus 3% for the end of the fourth quarter of 2020.
HC Securities “see[s] inflationary pressures largely subsiding following the July subsidy cuts,” economist and banking analyst at HC, Monette Doss, said.
On 22 August, the CBE’s MPC decided to reduce interest rates by 150 bps.