HC Securities anticipates CBE to maintain interest rates
Updated 10/13/2024 10:42:00 AM
Arab Finance: HC Securities and Investment's Financial Research Department expects the Monetary Policy Committee (MPC) of the Central Bank of Egypt (CBE) to keep interest rates unchanged during its meeting on October 17th, 2024, as per an emailed research note to Arab Finance on October 13th.
Head of Financial Research at HC Nemat Choucri said the CBE is likely to opt for delaying the interest rate cut to a later time this year
Choucri also highlighted several positive indicators reflecting an improvement in Egypt's external financial position.
These indicators include that the balance of payments surplus for the fourth quarter (Q4) of FY23/24 surged nearly ninefold year-on-year (YoY) and increased by approximately 22% quarter-on-quarter (QoQ) to $5.55 billion.
Additionally, the Egyptian banking sector maintained a net foreign currency asset position of $9.73 billion in August, although this represented a decrease of $3.54 billion month-on-month (MoM).
Despite these positive signs, economic growth remains constrained by rising interest rates that negatively impact private-sector investment.
Looking ahead to inflation, HC Securities forecasts a rise of 1% MoM to 26.5% YoY in October, driven by recent electricity price hikes and potential increases in energy costs.
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