JPMorgan anticipates 2% hike in interest rates by CBE

CAIRO – 12 March 2024:  JPMorgan predicts the Central Bank of Egypt (CBE) will implement another 200 basis points (2 percent) increase in interest rates during its upcoming meeting on March 28, Reuters reported. This move is aimed at tackling inflationary pressures.

 

 Furthermore, JPMorgan's analysts have revised their stance, stating that they no longer anticipate any potential rate cuts until February 2025.

 

In recent developments, the Central Agency for Public Mobilization and Statistics (CAPMAS) disclosed that the annual inflation rate in Egyptian cities reached a new high of 36.0 percent in February 2024, surpassing January's rate of 31.2 percent.

 

 The consumer price index in Egypt also rose to 219.4 points in February 2024.

 According to CAPMAS, the monthly inflation rate for February 2024 stood at 11.0 percent, an increase compared to January's rate of 1.7 percent .

 

During a special meeting, the Monetary Policy Committee (MPC) of the CBE made significant adjustments to key interest rates. The overnight deposit rate, overnight lending rate, and the rate of the main operation were all raised by 600 basis points, resulting in rates of 27.25 percent, 28.25 percent, and 27.75 percent respectively. Additionally, the discount rate was raised by 600 basis points to reach 27.75 percent.