Egypt cuts interest rates

Egypt’s central bank cut its main interest rates by 50 basis points to support an economy badly hit by the coronavirus pandemic as inflation remained muted.

Egypt’s economy contracted by 1.7per cent in the second quarter of 2020, the bank’s Monetary Policy Committee (MPC) said in a statement accompanying the decision to reduce the overnight lending rate to 9.25pc from 9.75pc and the overnight deposit rate to 8.25pc from 8.75pc.

Most analysts in a Reuters poll had forecast the bank would leave rates unchanged, although seven of 16 predicted the 50 basis point cut, noting inflation was near its lowest in years. A

The MPC said it expected inflation to remain in the low single digits in the last quarter of 2020, below its target floor of 6pc.