(Ecofin Agency) - The Central Bank of Egypt cut its key interest rates by 50 basis points. The move is to support an Egyptian economy that dropped by 1.7% in Q2 this year, the Monetary Policy Committee MPC said on November 12.

Due to restriction measures imposed to control the propagation of the coronavirus pandemic, the high growth recorded in recent years only reached 3.6% in FY2019-20, against 5.6% the previous year. While growth slumped, inflation rose. It jumped to 4.5% in October 2020, compared with 3.7% in September 2020 and 3.4% in August 2020. However, the Central Bank said, the inflation is expected to stay below the 6% cap forecasted for the year.

“The reduction in key policy rates […] provides appropriate support to economic activity while remaining consistent with price stability over the medium term. Annual inflation rates continued to reflect moderate inflationary pressures,” the MPC said.

 Moutiou Adjibi Nourou