The Egyptian central bank hiked overnight interest rates by a more-than-expected 300 basis points – or three percent – amid a sharp rise in domestic inflation.
The bank’s Monetary Policy Committee (MPC) 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, on Thursday.
It also raised the discount rate by 300 basis points to 16.75 percent.
The hike is more than the 200 basis points predicted by an analysts’ poll earlier.
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.
The annual core inflation rate recorded 21.5 percent in November, up from 19 percent in October, the bank said in a statement.
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.
The latest MPC decision comes a week after the announcement of a new International Monetary Fund (IMF) $3 billion loan for Egypt.
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