How interest rate hikes affect Egypt’s economy

The central bank may raise rates further by 100 to 200 basis points in 2022 to be in line with tightening global monetary policies. Yields on T-bills are set to rise.
Workers on bikes deliver Egyptian traditional Baladi bread.
Workers on bikes deliver Egyptian traditional Baladi bread from a bakery in Al-Azhar neighborhood to bread stands on May 9, 2022, in Cairo, Egypt. Last month, Egypt introduced price controls on commercially sold bread in response to the rising price of wheat. Egypt imports 80% of its wheat supply from Russia and Ukraine, whose production and export have been disrupted by the invasion. - Roger Anis/Getty Images
Al Monitor: The Pulse of the Middle East
Ahmed Elleithy
@adonisahmed

Egypt’s authorities are drawing on a gradual tightening of monetary policy in a bid to contain inflation and sustain economic growth. The Central Bank of Egypt (CBE) has raised overnight interest rates by 3% since March 21, seeking measures to ease the repercussions of the Russia-Ukraine war, which has rattled the global economy since February.

The CBE’s Monetary Policy Committee (MPC) increased overnight rates by 2% on May 19 to 11.25% for deposits and 12.25% for lending. Earlier this month, the US Federal Reserve raised its policy rate by 0.50%.

Access the Middle East news and analysis you can trust

Join our community of Middle East readers to experience all of Al-Monitor, including 24/7 news, analyses, memos, reports and newsletters.

Subscribe

Only $100 per year.

Videos

See more