Egypt leaves key interest rate unchanged

07 Nov 2010

(MENAFN) The Central Bank of Egypt has decided to leave its key overnight interest rates on hold, saying non-food inflation was largely subdued and global economic growth was uncertain, Reuters reported.

The bank’s monetary policy committee met hours after a new asset-buying plan by the U.S. Federal Reserve caused the Egyptian pound to post one of its biggest increases against the dollar in nearly six years.

Before the committee’s meeting, some analysts had said the U.S. policy of quantitative easing would increase the already wide differential between Egyptian and U.S. interest rates, making the bank even less likely than before to increase rates.

The central bank kept its overnight lending rate steady at 9.75 percent and the deposit rate at 8.25 percent, its ninth pause since it stopped lowering rates in September 2009. It also left the discount rate unchanged at 8.5 percent.

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