The Central Bank of Egypt’s Monetary Policy Committee left interest rates on hold at its Thursday meeting, in line with expectations. Overnight deposit and lending rates remained unchanged at 18.75% and 19.75%, respectively, with the discount rate also steady at 19.25%. The move indicates “that further declines in inflation were needed to warrant a shift towards a looser policy,” Reuters says. The CBE is watching for inflation to cool below the 30% marker to 13% by 4Q2018 and single digits afterwards. Annual headline and core inflation rates had dropped for a third consecutive month in October to 30.8% and 30.5%, after climbing to a high of 33.0% and 35.3% in July, “supported by the combination of previous policy rate increases and the recent appreciation of the EGP against trading-partner currencies,“ the CBE said in a statement. “Against this background, the MPC decided that current policy rates remain appropriate...The baseline inflation outlook remains consistent with achieving the CBE's inflation targets.”

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